May 15, 2019 / 12:05 PM / a year ago

Race for Italian chemicals firm ICE attracts four buyout funds: sources

LONDON/MILAN/FRANKFURT (Reuters) - Four private equity firms are looking to submit final bids for Italian chemicals firm Industria Chimica Emiliana (ICE) in a deal valued at about 600 million euros ($673 million), sources familiar with the matter told Reuters.

    U.S. buyout funds Bain and Advent are lining up rival offers for the family-owned company and are facing competition from European buyout groups Cinven and Astorg, the sources said.

ICE, based in the central Italian town of Reggio Emilia, has drafted in PWC to handle the sale and is hoping to find a new owner before the summer, the sources said.

    Binding bids for the 70-year-old firm are due in the coming weeks and could value the business at about 10 times its core earnings of roughly 60 million euros, they said.

    ICE, Bain, Cinven and Astorg declined to comment, while Advent was not immediately available for comment.

    Led by Chief Executive Enzo Bartoli, ICE ranks as a leading producer of bovine and swine bile derivatives for the pharmaceutical industry.

It has operations in Brazil and across South America where it collects ox-bile to produce cholic acid, used by drugmakers to treat liver conditions.

    The business, which is wholly-owned by the Bartoli family, had revenues of about 115 million euros in 2017.

    Big buyout funds are increasingly targeting pharma companies and related chemicals as they seek to deploy cash in resilient industries where demand will remain stable even in the event of a downturn.

    Bain and Cinven took joint control of German drugmaker Stada in 2017 while Advent bought Sanofi’s generics arm Zentiva last year.

    Paris-based buyout fund Astorg is also keen to invest in ICE after raising 4 billion euros for its seventh fund in January.

    One of the sources said Astorg made the first approach for ICE, prompting the family owners to seek bids from other funds to maximize the company’s value.

Additional reporting by Ludwig Burger; Editing by Alexander Smith

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