BUSINESSDESK: Champ Private Equity has hired Goldman Sachs to sell its indebted printer Blue Star Group after receiving unsolicited approaches to buy the business last month.
Goldman Sachs is assessing the approaches and looking at other possible avenues for sale on behalf of Sydney-based buy-out firm Champ, which bought its controlling 84% stake in Blue Star in 2006 from interests associated with then-managing director Tom Sturgess at a price based on an enterprise value of $385 million.
Senior lenders had agreed to maintain their support during the sales process, Blue Star said. It last year convinced bond holders to roll over $105 million of NZDX-listed bonds, extending the term and providing more financial covenant headroom.
The new bonds, which mature in September 2015, last traded at 1.2 cents per $1 face amount.
While the restructuring provided some breathing space, Blue Star’s trading has not been as strong as had been hoped when it issued a prospectus for the transaction.
In its first-half results, chairman Nick Greiner said earnings before interest, tax, depreciation and amortisation for the year ended June 30 would fall short of the $A53.6 million it had forecast as a “poor trading environment” in the first half was likely to continue.
Blue Star’s sale price is reportedly $A100 million to $A150 million, depending on the shape of the sale, the Australian Financial Review reported, though company sources called that “just speculation” and wouldn’t confirm that the sale could be completed in a matter of weeks.
Blue Star has bank debt of some $A167 million and finance leases of $A43 million. The printing group also owes Champ $16 million via a senior loan, bringing the total owed to $A226 million.
The amended capital bonds were given at $A18.7 million, compared to the value of the pre-amended bonds a year earlier of $A135 million including accrued interest.
This article is tagged with the following keywords. Find out more about MyNBR Tags
Most listened to
- FMA's Rob Everett says confidence in capital markets is increasing
- NBR's Rob Hosking says housing and debt are the two things people haven't grasped about Budget 2017
- FNZC's John Norling on last week's star stocks and this week's outlook
- RedShield founder explains what makes his cyber service so attractive to Fortune 500 companies
- Rodney Hide thinks Judy McGregor should be persuading companies to increase gender diversity instead of legislating
- NBR Radio: best of the week ended May 26, with Grant Walker