Reuters: Private Equity: Brambles talks Recall deal with Shred-it -sources

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Brambles talks Recall deal with Shred-it -sources May 15th 2012, 23:53 Tue May 15, 2012 7:53pm EDT * Cintas also held talks with Brambles on Recall -source * Recall deal outcome seen by end-May as planned -source * Private equity balks at $2 bln-plus price tag -sources By Soyoung Kim and Greg Roumeliotis NEW YORK, May 15 (Reuters) - Australia's Brambles Ltd has held discussions with document destruction company Shred-it about selling its U.S. information management business, after private equity firms did not meet its $2 billion-plus valuation expectations, according to several people familiar with the matter. Brambles has also discussed a potential sale of its Recall subsidiary with Ohio-based Cintas Corp, which offers document management services including shredding, one of the sources said. Several private equity firms including Apollo Global Management, Thomas H. Lee Partners and Onex Corp had considered buying Recall earlier this year, but their interest cooled due to a substantial valuation gap, according to the people familiar with the matter. Shred-it, controlled by Canadian private equity firm Birch Hill Equity Partners, has spoken to banks about financing a potential deal, the sources said. Brambles, Shred-it and Cintas declined to comment. Apollo and THL did not have immediate comment. Brambles, the world's top pallet supplier, has said it plans to announce a decision on the Recall divestiture by the end of May. It is on track to announce an outcome as previously indicated, one source said. The process has been slowed down as potential buyers balked at the valuation expectation of Brambles, which had hoped to fetch more than 9 times the unit's earnings before interest, tax, depreciation and amortization (EBITDA) of some $240 million -- or about $2.2 billion -- the sources said. Recall is the latest Brambles business to be put on the block. As it scaled back its presence as a global conglomerate, the company also sold its waste management, material handling and other businesses over the last five years to focus on its core business - pallet and container pooling services. Link this Share this Digg this Email Reprints

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