Tags: kkr | german | coffee-machine | maker

KKR Bids $725 Million for German Coffee-Machine Maker

Friday, 06 July 2012 12:10 PM

WMF Wuerttembergische Metallwarenfabrik AG received a takeover bid from KKR & Co. that values the German maker of hotel coffee machines and kitchen utensils at about 586.2 million euros ($725 million).

KKR plans to offer 47 euros for each ordinary share and at least 31.70 euros a preferred share, the New York-based private equity firm said in a statement Friday.

WMF, which is being sold by Swiss private-equity firm CapVis Equity Partners AG, is expanding its coffee-machine business and pushing into China. Private-equity firms CVC Capital Partners Ltd. and Bain Capital LLC were also interested in the Geislingen, Germany-based company, people familiar with the negotiations said in April.

“A lot of Germans associate WMF with cutlery but the real value driver is coffee,” said Klaus Kraenzle, an analyst at Silvia Quandt & Cie. “KKR’s strategy will be to expand this business because it offers high margins.”

WMF shares surged as much as 24 percent to 46.70 euros in Frankfurt trading, the highest price since 1989. The stock closed up 23 percent at 46.45 euros.

KKR bought Crystal Capital GmbH’s 52 percent stake in WMF and Crystal Capital, an investment vehicle of CapVis, committed to tender 256,489 WMF preferred shares, KKR said.

Fiba, an investment company of Andreas Weissenbacher, said it won’t sell its WMF shares, Reuters reported. Fiba is WMF’s second-largest shareholder with a 37 percent stake, according to data compiled by Bloomberg.

WMF said on May 15 that first-quarter operating profit gained 23 percent to 25.3 million euros, boosted by higher demand for coffee machines. Sales increased 5 percent to 243.6 million euros.

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