CVC to pay $175m to retain stake in luggage-maker Samsonite
CVC Capital Partners will pay $175m to hang onto its 60 per cent stake in Samsonite, the world’s biggest maker of suitcases and backpacks, according to a report in the Financial Times.
This marks the latest example of private equity-owned companies bought at the height of the credit bubble having to swap debt for equity.
Samsonite needs the fresh capital as a recent decline in international air travel has meant that business is scarce, according to the report.
CVC acquired the luggage-maker just as the credit crisis started in July 2007 in a $1.7bn deal.
UK government-owned Royal Bank of Scotland has taken a minority stake in Samsonite, which allows it to avoid breaching its banking covenants this month, the report said.
The deal will bring Samsonite’s debt down from around $800m to $240m.
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