The Blackstone Group and TPG Capital are teaming up in a planned bid for Gates Global, a maker of industrial and automotive parts, a person briefed on the matter said on Monday.
The firms are offering roughly $5.5 billion, according to this person, which would make the deal one of the largest private equity buyouts of the year so far, second only to the buyout last week of Safeway, which was worth more than $9 billion.
The deadline to bid for Gates Global is Wednesday, the person said. No other bidders are expected, though the situation remains fluid.
The Canada Pension Plan Investment Board, one of the owners of Gates Global, may contribute its stake to the Blackstone-TPG deal, according to the person, who spoke on condition of anonymity.
The owners of Gates Global, which include the private equity firm Onex, have also contemplated taking the company public, filing a prospectus for an initial public offering in December. A so-called dual-track process â€" in which owners pursue both a sale and an I.P.O. â€" is a popular method of trying to get the best possible price.
Onex and the Canadian pension plan bought Gates Global in 2010. The company, which is based in Denver, makes parts like power transmission belts, engine hoses and hose fittings.
News of the talks was reported earlier by The Wall Street Journal online.
