A single-asset secondary transaction is on the table for consideration by Clayton Dubilier & Rice that could garner $4 billion for the Belron Group.
Clayton Dubilier’s United Kingdom-based glass repair company, Belron, operates in 40 countries with 27,000 employees working for several brands including Safelite AutoGlass in the United States.
In 2018, Clayton Dubilier acquired 40 percent of Belron, but earlier in 2021 agreed to sell a portion of that stake to funds owned by Hellman & Friedman, Blackrock Private Equity Partners and GIC Private Ltd. The deal is on schedule to close in the third quarter of 2021 and leave Clayton Dublier with a 24 percent interest in Belron, which would set the valuation for Belron’s equity at the equivalent of $20.35 billion.
The firm is expected to raise between $2 billion and $4 billion in investments of cashed- out original stakes. If 50 percent of investors cash out, $2 billion will be raised, but if all investors cash out $4 billion will be raised, making it one of the largest single asset-secondary deals ever made.
“Transactions like these occur — these are private equity terms that typically never see the light of day,” says one financial expert familiar with the auto glass industry who prefers to not be identified. Clayton Dubilier’s transaction deal will not affect the day-to-day operations of Belron or any of its auto glass shops. “Personally, I think it doesn’t matter,” he added.
Essentially, Clayton Dubilier is giving investors who would like to get out an exit strategy. Single-asset transactions allow limited partners — in this case, those invested in the original 40% of Belron– to exit if they want.
“This type of transaction offers a validation of the valuation of Belron based on the valuation of CDR’s sale of a portion of its shares to the new investors in the company. I’m sure they’ll have plenty of buyers,” the expert added.