Banks start sale of Evonik minority stake - report

06 March 2008 14:56  [Source: ICIS news]

TORONTO (ICIS news)--Investment banks have started the €2bn ($3.1bn) sale of a 25% minority stake in Evonik Industries, which includes the former Degussa specialty chemicals business, German media reported on Thursday.


According to Frankfurter Allgemeine Zeitung, two banks charged with overseeing the sale – Deutsche Bank and Morgan Stanley - have begun sending out “information packages” to 10 investment funds interested in buying a minority stake in Evonik.


German business daily Financial Times Deutschland reported last week that RAG was seeking to sell a 25% stake in Evonik to a financial investor as capital market conditions for a listing had deteriorated.


The bidders would need to submit first non-binding offers by the end of the month, Frankfurter Allgemeine Zeitung said, citing unnamed financial market sources close to the deal.


Wolf-Rudiger Grohmann, spokesman for Evonik owner RAG Stiftung in Essen, Germany, declined additional comment. 


Potential investors included private equity firms with considerable expertise in chemicals mergers and acquisitions such as Blackstone, Permira, BC Partners, KKR and Bain Capital.


RAG was hoping to float an additional 50% on the stock market in 2009 and would retain the remaining 25%, according to the paper. 


Evonik CEO Werner Muller and the powerful IG BCE union chief Hubertus Schmoldt are believed to favour an initial sale to an investor rather than a cold start on the German stock market, which is currently in a depressed state.


Schmoldt was quoted by the paper as saying that going to the stock market first would put the company under pressure to perform rather than opening a more long-term perspective.


($1 = €0.65)


Dede Williams contributed to this story

By: Stefan Baumgarten
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