London/Frankfurt: Siemens AG has picked five private equity houses, and a strategic buyer, for the second round of bidding for its hearing-aid unit, several sources familiar with the matter said.
The German industrial conglomerate, which makes a broad range of products from fast trains to light bulbs, is sharpening its focus on core areas and put the unit up for sale late last year.
Bain Capital, Cinven, Hellman & Friedman, KKR and Permira are all in the running for the unit, which Siemens hopes will fetch more than €2 billion ($2.89 billion), the sources said. A strategic acquirer is also seeking to buy the unit, they said.
Cinven, Permira and Siemens declined to comment. Bain, H&F and KKR were not immediately available to comment.
Two of the buyout houses are working together, one of the sources said, adding that some other trade bidders such as Danaher and Procter & Gamble Co had earlier shown interest but had since left the race.
The field of private equity firms has been narrowed from a much wider initial group, including CVC and BC Partners, the sources said.
The unit, which competes with Switzerland’s Sonova Holding AG and Denmark’s William Demant Holding A/S, is projected to make earnings before interest, tax, depreciation and amortisation (Ebitda) of some €170 million in 2010, the sources added.
Bidders will now gain access to a data room and hear management presentations in the coming days, the sources said. After receiving binding bids, Siemens hopes to pick a winning bidder by the end of February, they added.
UBS is running the auction.