Potential buyers prepare for sale of Spotless laundry division

A number of private equity firms are believed to be ‘preparing to bid for the $400 million-plus laundry division of the recently listed services provider Spotless,’ reported The Australian on 27 June 2016.

A number of private equity firms are believed to be ‘preparing to bid for the $400 million-plus laundry division of the recently listed services provider Spotless,’ reported The Australian on 27 June 2016. Spotless report

With the sales process of the laundry division is expected to begin this week, it has been understood that Spotless, which is advised by Highbury Partnership, has already asked for ‘expressions of interest from prospective suitors, which also includes a list of trade buyers’.

The Australian noted that ‘there are varying views as to how appealing the division of Spotless, which was previously owned by Pacific Equity Partners (PEP), would be to buyout firms, given that PEP is considered a master at eliminating unnecessary business costs, leaving little opportunity for the next private equity firm to extract additional value in this area should it be an acquirer’.

According to analysts at Deutsche, Spotless’ laundries division is expected to make $68 million earnings before tax, interest, amortisation and depreciation for the 2017 financial year.

On 30 May 2016, Spotless published a statement to the Australian Securities Exchange, explaining that it was looking for a potential sale of its laundries businesses, following a number of approaches from prospective buyers.

‘Various suitors were tipped to be circling Spotless after its shares crashed by about 40 per cent in December following a profit warning’.

www.theaustralian.com.au

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