St Gobain to benefit from Jewson sale

St Gobain to benefit from Jewson sale

People familiar with the matter said that private equity appetite will overcome tough financing markets because of the sale of UK building supplies merchant Jewson.

The French supplier of construction companies has sent marketing documents to potential suitors and asked for first round bids around mid-October, according to people who asked not to be identified because discussions are private.

The people said that the buyout firms that are likely to look at the asset include CVC Capital Partners, Clayton Dubilier Rice, Lone Star Funds, Cinven and Advent International.

Jewson has more than 170 million $192 million in earnings before interest, taxes, depreciation and amortization, and could fetch more than 1 billion, the people said. Its bigger listed rival Travis Perkins Plc has a market value of about 1.7 billion.

In Paris, St. Gobain shares rose by as much as 3.5%. They are down 37% this year.

Representatives for St. Gobain, CVC, CD&R, Lone Star, Cinven and Advent didn't want to make a statement.

Sky News previously reported that JPMorgan Chase Co. was hired to investigate the sale of Jewson, founded by George Jewson in 1836, and offers timber, building materials and equipment hire. In 2000, St. Gobain acquired the business as part of its takeover of Meyer International Plc.

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

Americans are moving to cheaper places after home prices go up, despite the fact that Home prices are not as high as in the United States.