Ex The Australian Financial Review (Street Talk section)- 30 March 2010.
Street Talk
Move over locals, here comes Carlyle
PUBLISHED: 30 Mar 2010 01:05:33 PRINT EDITION: 30 Mar 2010
Edited by Jamie Freed and Sarah Thompson
In a clear sign that private equity is back with a vengeance, or that the initial public offering market needs to toughen up, US
behemoth, the Carlyle Group, has muscled in on the $300 million float of Contract Aviation Industries (CAI) from joint lead
managers, Commonwealth Bank of Australia and WilsonHTM.
As reported in Street Talk, Carlyle secured an exclusivity period of two weeks last Sunday night during which time the private
equity firm will need to decide on a bid and convince CAI to go unconditional.
This involves securing debt finance (Deutsche Bank is advising Carlyle on this point) and, while markets are still quite tight, the
offer for CAI was about $200 million, which is within the size for which a private equity firm could obtain funding.
Worth noting are rumblings that the institutions that bid in the float are on the war path, with some quarters suggesting they were
used as a stalking horse throughout the process.
Investors will remember that in the case of Flexigroup’s dual-track process, the IPO was outbid by trade and then the IPO came
back again.
However, in CAI’s case, the instos haven’t had a chance to rebid (yet).
The Australian Financial Review