(Repeats, without changes, story first published on Wednesday)
By Pamela Barbaglia
LONDON, Sept 28 At least four private equity
funds including BC Partners are in talks to buy a majority stake
in Italy's fourth-biggest supermarket chain Esselunga in a deal
worth up to 6 billion euros ($6.7 billion), sources familiar
with the matter told Reuters.
The talks, led by Citi, started earlier this year amid
efforts to find a succession plan for the business, which runs
more than 150 stores across Italy and is held by Bernardo
Caprotti, who will turn 91 on Oct. 7.
London-based BC Partners is one of two private equity houses
which recently joined the race to submit offers and outbid
previous expressions of interest from two other heavyweight
funds, Blackstone and CVC Capital Partners, the
Esselunga, Blackstone and BC Partners declined to comment
while CVC was not immediately available for comment.
Caprotti, who co-founded the business in 1957, started
informal talks with Blackstone and CVC about six months ago, the
The two funds were later granted access to the company's
books in August to perform due diligence, one of the sources
said, but price disagreements soon emerged.
After extensive negotiations with Blackstone and CVC,
Caprotti asked Citi to launch a strategic review to sound out
interest from other buyout funds, they said.
Italian private equity group Investindustrial was informally
asked to take part in the negotiations for Esselunga but has yet
to decide whether to make an offer, another source said.
The size of the transaction may be challenging for some
private equity firms, this source said, and these funds could
try to team up in a consortium with Italian investors.
Blackstone and CVC have almost completed their due diligence
work and remain keen to win control, the sources said.
Caprotti is against a sale of Esselunga to any of its direct
competitors, the sources said, and doesn't want to entertain
talks with industry rivals.
The billionaire businessman, who has been in a long-running
legal dispute with the two children of his first marriage over
ownership of the chain, stepped down as Esselunga chairman in
2011 and resigned from all executive functions in 2013.
But he has a final say on any change of ownership and his
price expectations are seen as ambitious, the sources said,
cautioning that the talks may yet fall apart.
Based in Milan, Esselunga holds a portfolio of real estate
assets worth more than 1 billion euros, one of the sources said,
adding the deal's value will hinge on whether these assets will
be part of it.
Caprotti, who comes from a long line of Italian businessmen
and often airs his views in the media, has rebuffed overtures
from international supermarket chains in recent years, another
Esselunga, which employs nearly 22,000 people in seven
Italian regions, primarily in the North of the country, grew its
revenues by 4.3 percent last year to an overall 7.3 billion
euros with core earnings of 625 million euros.
It offers private equity suitors the opportunity to roll out
the Milan-based business across Southern Italy and win market
share from Coop, Conad and Selex, which rank as Italy's largest
supermarkets by market share, the sources said.
A number of buyout funds have recently expressed interest in
European supermarket chains including Polish convenience chain
Earlier this year CVC teamed up with Qatar's QIA and
Canada's Brookfield Asset Management to bid for British
supermarket group Sainsbury.
BC Partners bought 50.8 percent of Turkey's largest
supermarket chain Migros in 2008 and subsequently sold part of
its stake to Turkish beverage firm Anadolu Endustri Holding last
($1 = 0.8928 euros)
(Additional reporting by Paola Arosio in Milan and Sophie
Sassard in London; Editing by Ruth Pitchford)