FRANKFURT (Reuters) - Buyout group EQT (EQTAB.ST) is starting preparations for the sale of facilities manager Apleona, a former unit of industrial services group Bilfinger (GBFG.DE), people close to the matter said.
EQT is expected to mandate an investment bank as advisor on the sale by year end or early next year and may start an auction in the first quarter, the people said, adding that no final decision on an exit had been made.
The investor, which bought the company at a valuation of 1.4 billion euros ($1.6 billion) in 2016, is expected to shop Apleona to other private equity firms as well as peers such as CBRE (CBRE.N), Cushman & Wakefield (CWK.N) and Jones Lang Lasalle (JLL) (JLL.N), they added.
EQT declined to comment.
Apleona employs roughly 20,000 staff in 30 countries and has annual sales of 2 billion euros. It counts BMW, Volkswagen, Daimler, BASF, Adidas, Siemens and Lufthansa among its clients.
This year, Apleona is expected to post earnings before interest, tax, depreciation and amortization of 120 million euros, with substantial growth expected next year, one of the people said. EQT is hoping to fetch at least the earnings multiple of 11 times it paid in the 2016 transaction.
CBRE, Cushman & Wakefield and JLL trade at between 7 and 9.5 times expected EBITDA but may be willing to buy a company at a higher valuation to expand their facility management services, which supplies a steady revenue flow albeit at lower margins compared to their more volatile project management services, one of the people said.
Following the carve-out from Bilfinger, Apleona has sold activities such as the turnkey construction business in Germany and its UK-based real estate advisory business GVA.
Bilfinger is set to benefit from any sale as a result of an earn-out clause in the 2016 deal, which among other provided equity-like participation rights. “This entitles Bilfinger to 49 percent of the resale proceeds, less debt, from EQT,” Bilfinger said in its 2016 annual report.
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Reporting by Arno Schuetze; Editing by Thomas Seythal and David Holmes