Kelso taps banks to sell PSAV for up to $1 bln -sources

NEW YORK, July 24 Wed Jul 24, 2013 4:01pm EDT

NEW YORK, July 24 (Reuters) - Kelso & Company has hired Barclays and Macquarie Group to find a buyer for event services company PSAV Presentation Services in a deal that could fetch as much as $1 billion, according to two people familiar with the matter.

Acquired by Kelso in 2007 for $413.4 million, PSAV is the largest provider of audiovisual services to the U.S. hotel industry and helps coordinate events and meetings using high-definition projectors and plasma screens.

The Long Beach, California-based company has earnings before interest, tax, depreciation and amortization (EBITDA) of between $130 million and $140 million and could be sold for between $900 million and $1 billion, the people said this week.

While other event services companies may be interested in PSAV, the company is more likely to be sold to another private equity firm, one of the people added.

The people asked not to be identified because the matter is not public. Kelso and PSAV did not respond to requests for comment while Barclays and Macquarie declined to comment.

PSAV strengthened its position in the niche market for audio visual services for the hotel industry last year by acquiring competitor Swank Holdings Inc for $270 million, equivalent to 8 times Swank's EBITDA, according to a credit research note at the time by Standard & Poor's Ratings Services Inc.

This resulted in PSAV increasing its market share from 27 percent to 45 percent, according to Standard & Poor's.

Founded in 1980, New York-based Kelso is currently investing out of its eight private equity funds, which raised $5.1 billion in 2008.

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