CVC, St Gobain eye deal for Jewson

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CVC, St Gobain eye deal for Jewson

People with knowledge of the matter said that the deal to sell UK building supplies merchant Jewson to CVC Capital Partners.

The people said that CVC's building materials business, Stark Group A S, is trying to hammer out final terms of an agreement with St. Gobain. The people said that it could reach a deal as soon as this week, but they asked not to be identified because the information is private.

Jewson could fetch as much as 1 billion $1.2 billion in a sale, the people said. Talks could fall apart, and another buyer could emerge if negotiations continue.

Representatives for CVC and St. Gobain didn't want to make a statement.

The French supplier of construction materials, St. Gobain, acquired Jewson in 2000 as part of its takeover of Meyer International Plc. George Jewson was founded in 1836 by the UK retail business and provides timber, building materials and equipment hire.

A year ago, CVC agreed to buy Stark Group, a leading distributor of heavy building materials for the construction industry in northern Europe. According to its website, the Copenhagen-based firm serves more than 260,000 customers across the Nordics, Germany and Austria.

The private equity firm's ability to do the deal through Stark made it easier to obtain financing, giving it a leg up against rival buyout funds that didn't already own a business in the sector.

The Jewson disposal is a challenge for St. Gobain Chief Executive Officer Benoit Bazin, a serial dealmaker. The banks are spooked by deteriorating macroeconomic conditions and reducing their willingness to lend on deals. Private credit funds have stepped in to fill the gap on smaller deals.

With help from Kiel Porter and Francois de Beaupuy.