Atlanta-based BWAY, a supplier of rigid metal and plastic containers via 22 North American plants, is being sold by Madison Dearborn Partners LLC, which bought the company in 2010 for $915 million.
Terms of the deal call for Platinum Equity, the private equity firm founded by Tom Gores, to fund the purchase along with contributions from BWAY senior executives and other employees.
The deal appears to have scored seller Madison Dearborn a 90% gain on BWAY. The firm made a $293.8 million equity investment in BWAY in 2010 as part of its purchase of the firm, according to Moody's Investors Service. The return reflects a $135 million dividend Dearborn raked off just four months after the purchase, plus at least $420 million in cash proceeds from the deal.
BWAY chief executive Ken Roessler in a statement said he believes Platinum Equity's support will help the company grow.
"Platinum brings to BWAY a strong operational and strategic focus and a tremendous track record of value creation that we are convinced will help us achieve new levels of success," Roessler said. "We look forward to taking the next step in the evolution of our company."
In addition to equity contributions, the deal includes committed financing from Bank of America Merrill Lynch and Deutsche Bank AG. Platinum Equity said it intends to keep BWAY's existing 10% senior notes due 2018, which were used to fund the Madison Dearborn buyout, but it will refinance the company's 10.125%/10.875% senior PIK toggle notes due November 2015 with the proceeds of its debt financing.
Goldman, Sachs & Co., Barclays plc's Michael Palm and Deutsche Bank Securities Inc.'s Frank Oelerich, Niall Cullinane, Christopher Weil, Michael Walsh and Stephen Schlosser served as financial advisers to BWAY. A Kirkland & Ellis LLP team led by Carol Anne Huff, Richard Campbell, Jon-Micheal Wheat and Michael Wright served as the company's counsel.
A Latham & Watkins LLP team led by David Brown and including partners Lisa Watts, James Barrett, Christine Rolph, Patrick Shannon, Jennifer Van Driesen, David Della Rocca and David Shapiro provided legal assistance to Platinum Equity.
-- David Carey contributed to this report.
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