CVC’s Mantra on the block

UBS - which also owns a substantial shareholding in Mantra - has been mandated to run the sales process for the Gold Coast-based company, which runs a network of more than 130 hotels, resorts and retreats under the Peppers, Mantra and BreakFree brands.

Mantra reportedly recorded a turnover of A$429 million (US$454.3 million) last year. The group employs 3,500 people and is led by chief executive Bob East.

Another CVC portfolio company, Nine Entertainment, is currently mulling offers for its ticketing arm Ticketek, Allphones Arena and magazines business ACP Magazines in an attempt to ease the strain of its A$2.7 billion debt pile due to be refinanced in February next year.

The sale of Ticketek, an agency which processes more than 18 million tickets to 13,000 events each year, could fetch as much as A$400 million, representing 8x underlying earnings. Groups including other private equity firms and trade companies have already expressed interest.

CVC bought Nine for A$5.3 billion in cash through several transactions between 2006 and 2008, but has seen the value of the assets drop significantly since then.

Following considerable secondary trading, Oaktree Capital and Apollo Global Management hold A$1 billion or about 37% of Nine's senior debt, and CVC has refused to entertain their proposals for a debt-to-equity swap which would effectively hand the hedge funds control of the company. In total, hedge funds are thought to own 50-60% of the debt.

CVC needs 100% lender approval to extend the life of the debt and a two-thirds vote to amend covenants. Two proposals to restructure the debt have met with a lukewarm response from creditors and subsequently been shelved.

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• Topics
• Exits
• Consumer
• Australasia
• Australia
• CVC Capital Partners
• Exit
• Consumer