Buyout firm Advent International Corp. has told bidders for Domestic & General Group Ltd. that it plans to pay itself a special dividend if the sale of the U.K. home-appliance insurer collapses, three people with knowledge of the matter said.
Advent is in talks with potential buyers, including London-based private-equity firm CVC Capital Partners Ltd., to sell Domestic & General for as much as 1 billion pounds ($1.5 billion), said the people, who asked not be identified because the talks are private.
Domestic & General may take out new loans to pay Advent, its owner, a dividend of as much as 150 million pounds, more than twice the Bedworth, England-based company’s 72.7 million-pound earnings before interest, taxes, depreciation and amortization for the year ended March 2012, one person said.
Advent hired Goldman Sachs Group Inc. (GS:US) to sell D&G earlier this year and received bids from private-equity firms including Blackstone Group LP (BX:US) and Clayton, Dubilier & Rice LLC. Concerns over possible regulatory changes and the purchase price led some bidders to drop out, the people said.
D&G, which was bought by Boston-based Advent for 524 million pounds in 2007, had sales of 571.8 million pounds in 2012, according to its website.
Officials at Advent, D&G, CD&R and CVC declined to comment. A spokeswoman for Goldman Sachs and a spokesman for Blackstone didn’t reply to e-mails and phone calls for comment.
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