NEW YORK/LONDON, June 15 Australian financial services firm Link Group and three buyout funds are putting the finishing touches to their rival offers for Capita's asset management services arm, a deal worth up to 800 million pounds ($1.02 billion), sources told Reuters on Thursday.
The British outsourcing group hired Goldman Sachs last year to launch an auction process for one of its units, Capita Asset Services, in a bid to raise cash and return to growth after a string of profit warnings, partly due to Britain's vote to leave the European Union.
Chicago-based private equity fund GTCR and European rival CVC Capital Partners are among a group of three buyout funds which are competing with Link Group, a provider of shareholder management services as well as analytics, registry and fund administration services to more than 2,500 clients, the sources said.
Another source named European buyout fund BC Partners as the fourth bidder involved in the process, adding that the deadline for final bids is on June 21.
Capita, GTCR, BC Partners and CVC declined to comment while Link Group could not immediately be reached outside business hours.
Capita has a market value of 4.3 billion pounds and its near-total focus on Britain means that unlike some rivals it does not benefit from the translation of foreign currencies back into a weak pound.
Its chief executive Andy Parker resigned earlier this year after the company reported a bigger than expected drop in profits and said it would take until 2018 before it could return to growth.
As part of its turnaround efforts the London-based company is trying to simplify its structure, reduce the number of business units and their reporting lines to boost oversight and transparency.
The sale of its asset services unit, which serves a wide range of financial institutions including wealth and asset managers as well as banks, could fetch between 700 and 800 million pounds, the sources said.
It would help it to reduce its debt burden which stood at 1.7 billion pounds at the end of last year.
Capita Asset Services provides everything from shareholder solutions, fund management and loan servicing for all types of secured and collateralised loans. The business operates as a share registrar to 42 percent of Britain's main market listed companies.
($1 = 0.7880 pounds) (Reporting By Pamela Barbaglia. Editing by Jane Merriman)