FRANKFURT (Reuters) - U.S.-based packaging group Multi-Color Corporation (MCC) is nearing a deal to buy German packaging group Constantia Labels in a transaction worth more than 1 billion euros ($1.15 billion), people close to the matter said on Friday.
Buyout group Wendel (MWDP.PA), which had asked for final bids for Constantia by a July 12 deadline, views MCC’s offer as superior to those of investors Cinven [CINV.UL] and Pamplona, they added.
Wendel is expected to formally decide to enter exclusive talks with MCC as early as next week, they said, adding that at this stage no decision had been made as to how to proceed.
MCC is expected to have bid around 1.1-1.2 billion euros and had initially also offered Wendel a stake in MCC as part of the deal, one of the sources said.
The final terms of MCC’s bid could not immediately be learned. Details of the other bids were also not clear.
Wendel, Cinven and Pamplona declined to comment, while MCC was not immediately available for comment.
Wendel had asked Goldman Sachs (GS.N) to evaluate options including a sale of the group, which is part of its larger packaging firm Constantia Flexibles, after receiving offers from interested parties.
The investor, which owns 60 percent of Constantia Flexibles, as well as its co-investors are considering using proceeds from a sale of the labels group to fund add-on acquisitions for the remainder of the company.
Constantia Labels is expected to post earnings before interest, tax, depreciation and amortisation of 113 million euros this year and could be valued at more than 10 times that, in line with industry peers, sources close to the matter have said in the past.
Bankers have prepared around 800 million euros of debt financing to back a potential sale.
($1 = 0.8733 euros)
Reporting by Arno Schuetze and Alexander Hübner; Editing by Victoria Bryan