Private equity firms love assets being cast adrift from multinationals, and auctions for these so-called “corporate carve-outs” tend to be heated. A jumbo leveraged buyout in the skincare industry shows why — but raises questions as to what the selling corporations get in return.

A consortium led by Swedish buyout firm EQT AB and the Abu Dhabi Investment Authority bought Nestle SA’s skincare assets for 10.2 billion Swiss francs ($11.6 billion) in 2019, integrating them more tightly to form a unified dermatology business dubbed Galderma. The price was a heady 18 times profit as measured by earnings before interest, tax, depreciation and amortization. A sizable equity check was required of some 5.2 billion francs, and the borrowings were ambitious even for the cheap-money era.

QOSHE - A Frothy $12 Billion LBO Is Now Proving Buyout 101 - Chris Hughes
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A Frothy $12 Billion LBO Is Now Proving Buyout 101

2 11
07.03.2024

Private equity firms love assets being cast adrift from multinationals, and auctions for these so-called “corporate carve-outs” tend to be heated. A jumbo leveraged buyout in the skincare industry........

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