ZURICH As many as four potential bidders are wooing 110-year-old Swiss travel group Kuoni Reisen Holding AG, sources close to the negotiations said on Tuesday, after Kuoni said it had received preliminary approaches.
Sweden's EQT, Permira, Cinven, and a combination of Baring Private Equity Asia and China's HNA Tourism Group are among those looking at a possible deal, the sources said.
Bids are due by the end of January, one source said.
Analysts said Kuoni could struggle to attract a premium to its current 1.1 billion Swiss francs ($1.1 billion) market value as struggling businesses drag down a sale price.
One Swiss investor, BWM AG, which owns shares representing 4 percent of Kuoni's capital, said any bid would have to be at a significant premium to win its support.
The shares rose 1.5 percent to 293.25 francs, but BWM indicated that was well short of its expectations.
"For us, the fair value of Kuoni shares is at least 330 Swiss francs per share," said Pascal Pruess, a BWM investment analyst. "If somebody offers that much, then we would certainly consider a sale."
Kuoni had issued a statement earlier on Tuesday saying it had received approaches and it was evaluating the situation, with no certainty that a definitive offer would be made.
It did not name the third parties that had approached it. Kuoni added it was also looking at other strategic options.
Any sale would have to be approved by the Kuoni and Hugentobler Foundation, set up by the founding family in 1957, whose 25 percent voting stake lets it block any transaction.
A spokesman for EQT, whose investments include a stake in Nordic hotel chain Scandic, declined to comment, as did European private equity firm Cinven and Baring Private Equity Asia. HNA could not be reached and global investment firm Permira did not respond to requests for comment.
Kuoni last year sold what were once its mainstay tour operating activities in Europe and Asia amid fierce competition, leaving it with travel services units including a growing visa unit that arranges travel permits for governments and companies.
A loss-making business that organizes accommodation, transport and tours for other operators, as well as a hotel-bed database business it bought in 2011 but whose margins are under pressure, are likely to push down any sale price to close to the market capitalization, wrote Jon Cox, an analyst at Kepler Cheuvreux.
"It is hard to see much in the way of upside from current levels," Cox said.
(Additional reporting by Freya Berry in London, Alexander Huebner in Frankfurt and Anna Ringstrom in Stockholm; Editing by Michael Shields and Keith Weir)