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 Auto parts and building products maker Gates is a division of
Tomkins, which Onex and CPPIB jointly bought in 2010 for about $5
billion.
The sale is expected to close later this year, the companies said on
Friday.
Proceeds from the sale to the Onex Group, including co-investors,
would be about $2.0 billion, of which Onex Corp's share would be
about $550 million, including carried interest. CPPIB's share would
be about $1.5 billion.
Reuters reported last week that Blackstone was close to a deal to
buy Gates.
Denver, Colorado-based Gates, which filed for an IPO in December,
sells products ranging from power transmission systems to acrylic
bathtubs in more than 120 countries.
Gates generated $2.9 billion in sales and $536 million in adjusted
earnings before interest, taxes, depreciation and amortization in
the year ended September 28, according to a regulatory filing.
Onex said in March it would sell The Warranty Group, a provider of
extended warranty contracts, to an affiliate of TPG Capital
Management LP <TPG.UL> for an enterprise value of about $1.5
billion.
Goldman Sachs Group, Bank of America Merrill Lynch and Citigroup
served as financial advisors to Gates, while Latham & Watkins LLP
served as legal counsel.
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Morgan Stanley, Barclays, XMS Capital and Deutsche Bank served as
financial advisors to Blackstone, while Simpson Thacher & Bartlett
LLP served as legal counsel to Blackstone.
Blackstone said it has secured committed debt financing to be
arranged by Credit Suisse, Citibank, Goldman Sachs, Morgan Stanley,
Deutsche Bank and UBS.
(Reporting by Sneha Banerjee in Bangalore, additional reporting by
Soyoung Kim.; editing by Sriraj Kalluvila)
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