The Singapore government is buying a stake in the world's second largest scientific, technical and medical (STM) publisher, Springer Science + Business Media, reported to be more than 2 billion euros in debt.
The Government of Singapore Investment Corporation will take an 18 per cent stake in the debt-laden German company. The remaining 82 per cent will be taken by EQT, the private equity group controlled by the wealthy Wallenberg family of Sweden.
The deal is reported to be worth 2.3 billion euros (4.7 billion Singapore dollars) and includes about 2.2 billion euros of debt, according to Times Online and the Financial Times.
Goldman Sachs, Deutsche Bank, Barclays Capital and Unicredit have agreed to underwrite 1.72 billion eruos of new debt while EQT and GIC would invest about 450 million euros of fresh capital to repay debt at Springer, says the Financial Times.
Earlier, GIC bought stakes in the banking giants Citigroup and UBS when they were short of cash.
The Wall Street Journal says the deal represents:
- The biggest buyout deal in Europe in 18 months;
- GIC's first European co-investment;
- Possibly the beginning of a GIC push into the European markets.
Reports say Springer's British owners are selling their entire stake because no one was willing to buy a minority share on their terms. The deal "allows an exit for the two UK buyout firms that have owned the debt-laden business since 2003", says Reuters.
The Springer website says the deal "will give the Springer Group medium-term stability by removing imminent potential refinancing issues".
On the plus side, Singapore gains a top-flight international publishing business, which may be useful for a city-state aspiring to be a leading education and research centre.
