| NEW YORK
NEW YORK Chemical maker DuPont (DD.N) has asked private equity bidders to team up and make new offers for its car paint business after initial bids fell short of expectations, according to people familiar with the matter.
New bids for the business, which could be worth as much as $4 billion, are due on May 7, following management presentations to the buyout firms in recent weeks, according to two of the sources.
Five private equity groups have formed to bid for the Dupont business, all the sources said.
Carlyle Group LP and Apollo Global Management LLC (APO.N) have paired up, while TPG Capital LP TPG.UL has teamed up with Advent International, and KKR & Co LP (KKR.N) with Onex Corp OCX.TO, they said.
Sources told Reuters previously that Blackstone Group LP (BX.N) has teamed up with Bain Capital, and Clayton Dubilier & Rice LLC paired up with CVC Capital Partners.
Several of the private equity firms have concerns about the earnings assumptions that DuPont made for the business, as well as an industry trend where volumes in selling paint to auto body shops have been on a steady decline, according to the sources.
The interested parties have expressed those concerns in meetings with the management in the past few weeks, they said.
The performance coatings business primarily sells to Maaco and other auto paint refinishers. Ford Motor Co (F.N) and General Motors Co (GM.N) are also key customers, though selling to so-called original equipment manufacturers are not as lucrative.
All the sources were not authorized to speak with the media and asked not to be named. Representatives for the private equity firms did not have immediate comment, while DuPont declined to comment.
(Reporting by Greg Roumeliotis, Soyoung Kim and Michael Erman in New York; Editing by Richard Chang)