City heavyweights lead on £4.4bn Spectris take-private

Private equity giant Advent looks set to acquire UK precision instruments maker Spectris in a deal which gives the FTSE 250 company an enterprise value of £4.4 billion.

The cash offer was accepted by Spectris on Monday (23 June), with funding coming from a consortium that includes Advent, Canada Pension Plan Investment Board (CPP Investments) and Singapore sovereign wealth fund GIC.

A bidding war could yet emerge. KKR, which had an earlier bid rejected, confirmed on Monday that it remains in "advanced stages of due diligence" and urged shareholders to reject the Advent offer.

Bigger picture

The big-ticket takeover is among the UK’s largest this year, outsizing Qualcomm’s £2.1 billion swoop for Alphawave earlier this month and DoorDash’s £2.9 billion acquisition of Deliveroo in May.

Advent has a track record of targeting UK-listed industrials. It bought Laird for £1 billion in 2018, took Cobham plc private in a £4 billion deal in 2020, and added Ultra Electronics for £2.5 billion in 2021. Since then, it has carved out and sold off parts of those businesses - including a $1.55 billion sale of Ultra PCS to US acquirer Eaton earlier in June.

Advising

Slaughter and May is advising Spectris with a team led by corporate partners Victoria MacDuff and Harry Hecht. Partners Tina Zhou (competition), Chris Sharpe (pensions) and Phil Linnard (employment and incentives) are also involved.

Cleary is advising Advent on the M&A aspects, while a Weil team led by London office co-head Jonathan Wood with support from finance partners Tom Richards and Patrick Brendon is advising Advent on the financing side and is also providing antitrust advice.

Freshfields is advising CPP Investments, led by private capital partners Maria Ledeneva and David Sonter.

Norton Rose Fulbright is advising Morgan Stanley, as financial adviser to Advent. The team is being led by corporate partners Paul Whitelock and Kit McCarthy.