LONDON, July 30 (Reuters) - Bankers are working on debt financings of up to 720 million euros (962.86 million US dollar) to back a potential sale of crop protection company Cheminova as final bids for the business draw near, banking sources said on Wednesday.
Cheminova’s parent company Auriga Industries announced it had commenced a review of its strategic options in June.
Auriga hired JP Morgan to consider options for the company including a possible sale of Cheminova, which has attracted a number of bidders eager to do deals and put cash to work, the banking sources said.
Private equity firms Bain, CVC and EQT and Israel-based peer crop protection company Adama Agricultural Solutions are expected to submit second round bids in an auction process at the end of August after a large number of initial bids were received in July, the banking sources said.
Auriga, Cheminova, Adama, Bain and EQT declined to comment. CVC was not immediately available to comment .
Bankers are working on debt financings of around 600-720 million euros or 5-6 times Cheminova’s Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) of approximately 120 million euros, the bankers said.
Debt is likely to be a mix of senior and junior leveraged loans denominated in euros and dollars and high yield bonds could also be considered, they added.
Cheminova develops and supplies crop protection products to increase the yield and quality of crops for farmers.
1 US dollar = 0.7478 euro Additional reporting by Ole Mikkelsen in Copenhagen and Freya Berry in London; Editing by Christopher Mangham