(Adds financial, legal advisers on the deal)
April 4 Canadian private equity firm Onex Corp
and Canada Pension Plan Investment Board (CPPIB) said
they would sell industrial conglomerate Gates Corp to private
equity firm Blackstone Group LP for $5.4 billion.
Auto parts and building products maker Gates is a division
of Tomkins, which Onex and CPPIB jointly bought in 2010 for
about $5 billion.
The sale is expected to close later this year, the companies
said on Friday.
Proceeds from the sale to the Onex Group, including
co-investors, would be about $2.0 billion, of which Onex Corp's
share would be about $550 million, including carried interest.
CPPIB's share would be about $1.5 billion.
Reuters reported last week that Blackstone was close to a
deal to buy Gates.
Denver, Colorado-based Gates, which filed for an IPO in
December, sells products ranging from power transmission systems
to acrylic bathtubs in more than 120 countries.
Gates generated $2.9 billion in sales and $536 million in
adjusted earnings before interest, taxes, depreciation and
amortization in the year ended Sept. 28, according to a
Onex said in March it would sell The Warranty Group, a
provider of extended warranty contracts, to an affiliate of TPG
Capital Management LP for an enterprise value of about
Goldman Sachs Group, Bank of America Merrill Lynch and
Citigroup served as financial advisors to Gates, while Latham &
Watkins LLP served as legal counsel.
Morgan Stanley, Barclays, XMS Capital and Deutsche Bank
served as financial advisors to Blackstone, while Simpson
Thacher & Bartlett LLP served as legal counsel to Blackstone.
Blackstone said it has secured committed debt financing to
be arranged by Credit Suisse, Citibank, Goldman Sachs, Morgan
Stanley, Deutsche Bank and UBS.
(Reporting By Sneha Banerjee in Bangalore, additional reporting
by Soyoung Kim.; Editing by Sriraj Kalluvila)