The world’s top chemicals distributors, including Germany’s Brenntag, are circling Belgium-based Company Azelis
Rival chemicals distributors Univar and Nexeo Solutions, the former distribution arm of Ashland, are also interested in buying Azelis, which is owned by British private equity firm 3i Group, the people said.
Reuters reported in March that London-listed 3i had hired Bank of America Merrill Lynch to sell Azelis, which handles sales and development of the Mirasil cosmetics line and distributes food and beverage flavourings, such as a recently launched vegetarian bacon flavouring.
3i is aiming to run a tight auction process, in which a small number of potential trade buyers will soon be selected to bid for the business, one of the people familiar with the sales process said on Tuesday. The private equity group, which bought Azelis in 2007 in a 315 million euro ($447 million) deal, values its businesses conservatively and often sells at a big premium to asset value.
It held the Azelis equity at 193 million pounds ($314 million) at the end of September, which with debt of about 300 million euros taken out in 2007, could give Azelis an enterprise value in excess of 500 million euros.
“This valuation is not out of this world,” a source close to the seller said.
While there are no bidders from the private equity sector, the three bidders have buyout firms as their main shareholders.