The Blackstone Group has agreed to acquire industrial manufacturer Gates Global for $5.4 billion, according to people briefed on the matter.
A deal is expected to be announced after market close on Friday.
An announced acquisition would bring to an end months of negotiations over the fate of Gates Global, which is currently owned by private equity firm Onex and the Canadian Pension Plan Investment Board.
Last month, Blackstone and TPG pursued a joint bid for Gates Global. But the people briefed on the deal said that TPG shied away from being part of a big so-called club deal, the type that typified the private equity boom before the financial crisis and often led to middling results.
Blackstone will instead work with other investment partners to do the deal, these people said, and is expected to write an equity check of about $1.6 billion, the people briefed on the deal said.
The deal will be the latest large private equity acquisition, coming on the heels of Cerberus Capital Management’s acquisition of Safeway for more than $9 billion.
Gates Global’s owners last year decided to conduct a dual track process, moving ahead with an initial public offering of the company while also putting it up for sale. CVC, another private equity firm, was also considering making a bid.
Gates Global, formerly known as Tompkins, makes everything from auto parts to oil and gas equipment, and has nearly $3 billion in revenues annually
The Wall Street Journal earlier reported that a deal was near.
