Two investment groups, Apax Partners & Co. Ventures Ltd. and Investcorp, are the finalists in the race to buy the world's largest plastics equipment maker, Mannesmann Plastics Machinery AG, from Siemens AG, according to a German newspaper report.
Meanwhile, plastics machinery maker SMS AG of Dusseldorf, Germany, is out of the running, an SMS executive confirmed.
Investcorp and Apax declined to comment on the story, published June 12 in the Frankfurt newspaper, Frankfurter Allgemeine Zeitung. Officials of Siemens and MPM declined to confirm whether the story is accurate, but they said a decision on the winning buyer could be made by late June.
Siemens had announced in November that it wanted to sell all six MPM companies - makers of the machinery brands Krauss-Maffei, Van Dorn Demag, Demag Ergotech, Netstal, Billion and Berstorff. Siemens said it wanted to find a single buyer for the entire MPM business, a giant supplier of injection molding machines, extruders and polyurethane processing equipment, with 2000 sales of $1.2 billion and nearly 6,800 employees worldwide.
Industry sources said about 20 firms, mostly financial, expressed interest. The list also included at least two machine makers: Milacron Inc. and Germany's SMS, known for its Battenfeld, American Maplan and Cincinnati Extrusion lines.
Contacted on June 12, Helmut Eschwey, chairman of SMS Plastics Technology, said SMS no longer is a potential buyer of MPM. He declined to give details or say when SMS went out of the bidding.
``There can be only one winner,'' Eschwey said in a telephone interview from Germany.
Milacron's top executive, Daniel Meyer, disclosed in April that his Cincinnati company had decided against buying MPM.
Meyer suggested that Siemens was asking too much for the company.
The price tag has been a closely guarded secret. Earlier, two published reports speculated on the asking price, with one putting it at $920 million and the other at more than $1.5 billion. But the story in the Frankfurter Allgemeine Zeitung said a weakened market for plastics machinery forced the price lower, to about 800 million euros, around $675 million.
The German paper quoted MPM Chairman Wolfgang Vogl as identifying Apax and Investcorp as two finalists. But when contacted at his Munich office by Plastics News, Vogl declined to say anything until the buyer is named, which he said probably will happen in two or three weeks.
``I will not give any more comments,'' he said.
At Siemens, also in Munich, spokeswoman Elisabeth Ramelsberger said: ``We are in the process of selling [MPM] in the next few couple of weeks. We can't confirm the names that are mentioned here.''
She said Siemens also had no comment on the lower sales price.
The German newspaper said the buyer will be decided by June 27. Once a buyer is named, machinery industry speculation will shift to what that buyer will do with MPM. Will it continue running all six companies, take them public, or break them apart and sell parts or all of the businesses? Executives at several competing machinery makers have said they would be interested in buying parts of MPM.
After months when little information dribbled out, the MPM story is heating up just in time for a string of pre-K 2001 news conferences in Europe the week of June 18.
Trade press reporters will descend upon three MPM member companies - Netstal-Maschinen AG in Nafels, Switzerland, Demag Ergotech GmbH in Schwaig, Germany and Krauss-Maffei Kunststofftechnik GmbH in Munich.
Meanwhile, the news from Germany sent plastics machinery officials to the internet to dig up information on Apax Partners and Investcorp.
London-based Apax describes itself as one of the world's leading private equity investment groups. Founded in 1972, Apax now manages and advises more than $10 billion on behalf of institutional investors around the world, according to its Web site. Apax offices in the United States go by the name Patricof & Co. Ventures Inc.
The venture capital business Investcorp is based in Manama, Bahrain. Its corporate equity side has offices in London and New York.
The company, led by founder Nemir Kirdar, specializes in moving money from oil-rich Middle Eastern countries into investments in the United States and Western Europe.
According to its Web site, Investcorp has arranged 90 corporate and real estate transactions with a total value of about $19 billion.