The sale of Armacell is creating issues as Investocorp's base price could not be reached by the existing bidders. The private equity firm based out of Bahrain pegged the base price at Eur500 million or US$653.30 million.
The second round of bidding was set for March 11 was delayed after potential buyers would only be able to submit bids amounting to Eur400 million. These bidders were Charterhouse, HGCapital and Pamplona. Because of this second setback, the sale can be cancelled altogether.
Armacell was purchased by Investcorp back in 2007 while mired in Eur382.5 million in debt according to Thomson Reuters LPC data. The world's foremost flexible insulation manufacturer has cornered 40% of the market with most of its products used for pipe lagging, building ductwork and other uses.
The bids were lower for the set price after the company's future growth was questioned. The debt packages being prepared is in the Eur350 to Eur400 million range on a buyout enterprise value of Eur500 million.
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