LONDON, Aug 29 (Reuters) - Jefferies and Nomura have lined up a leveraged loan financing of around £1.2bn to back US buyout firm Leonard Green & Partners’ acquisition of intellectual property services provider CPA Global, banking sources said.
Cinven announced the sale of CPA Global to Leonard Green & Partners on Tuesday, for an undisclosed sum although sources close to the deal put the price tag at £2.4bn.
Jefferies and Nomura have underwritten the debt financing, which comprises a senior term loan that is expected to be launched for syndication to investors at the end of September or beginning of October, the sources said.
The loan is expected to be denominated in dollars and euros.
The financing also comprises a second-lien loan that has been preplaced with a Goldman Sachs fund.
The leveraged loan financing equates to around 7.75 times CPA Global’s approximate £145m-£150m Ebitda, the sources said.
Nomura and Jefferies are not restrained by regulations that have tried to cap highly leveraged deals at no more than six times, giving them an edge over other banks.
Leonard Green & Partners was not immediately available to comment.
Cinven decided to sell CPA Global, hiring Goldman Sachs and JP Morgan as sellside advisers and first round bids in an auction process were due in July.
The sale attracted interest from a number of private equity firms including Apax, CVC, Hellman & Friedman, KKR and Permira but many dropped out from the high sales multiple, sources said.
“Multiples went up to 16-17 times, it is crazy and many buyout firms couldn’t keep up with that valuation,” one of the sources said.
Cinven acquired CPA Global in 2012 from Intermediate Capital Group and the founder shareholders for around £950m, backed with £555m of debt financing. (Editing by Christopher Mangham)