LONDON — Cinven Ltd., a London investment firm that is trying to sell custom molder SPM Inc., may be part of an investment team making a bid for another firm with plastics interests: McKechnie plc. McKechnie of Walsall, England, has reshuffled much of its plastics portfolio in the past three years. It announced May 9 that it was negotiating a management-led buyout.
The next day, the Financial Times of London reported that Cinven would provide equity for the buyout, which it pegged at 450 million ($680 million).
The McKechnie board confirmed in a brief statement that its nonexecutive directors were in the early stages of talks with the executive management "and a potential provider of equity finance concerning the possibility of a newly formed company making an offer for the company."
Executives at Cinven and McKechnie were unwilling to comment further on the proposed deal. A Cinven spokeswoman in London said the firm would not confirm or deny its involvement with McKechnie.
McKechnie has transformed itself in the past three years into a higher-margin manufacturer of specialty aerospace components, fasteners and engineered plastic parts.
In October, the company sold its British consumer products division, including plants making decorative plastic parts for the furniture sector, to Newell Rubbermaid Inc. for $133 million.
Late last year McKechnie announced that it was ready to spend as much as $246 million on suitable acquisitions to boost its industrial fasteners and plastics divisions. Meanwhile, the company has grown its aerospace parts businesses in the past two years with the acquisition of several U.S. operations.
A year ago, Cinven bought Dynacast International Ltd., including its SPM custom molding operations, from London-based textiles and engineering company Coats Viyella plc for $528 million. In December, Dynacast announced that it intends to sell SPM, which is based in Anaheim, Calif.