(Bloomberg) -- Blackstone Group Inc. and Kirkbi AS are exploring a sale of Armacell International, the maker of specialized insulation products used by the International Space Station, according to people familiar with the matter.
The investment firms have invited potential advisers to pitch for a mandate in the coming weeks, said the people, who asked not to be identified because discussions are private. The business could be valued at about 1.5 billion euros ($1.7 billion), two of the people said.
Blackstone, the world's biggest alternative asset manager, and Kirkbi, the investment company owned by the family behind the Lego toy brand, agreed to buy Armacell from Charterhouse Capital Partners in 2015. Since acquiring Armacell, the buyout firms have grown the business through at least half a dozen acquisitions, according to the website, with revenue climbing though profit margins have stagnated.
Deliberations are at an early stage, and no final decisions have been made, the people said. Representatives for Blackstone and Kirkbi declined to comment.
Armacell, founded in 1954, has made products used everywhere from the Empire State Building to the gigantic Gorgon natural gas project in western Australia. The Luxembourg-based company had 610 million euros of net sales in 2018 and adjusted earnings before interest, tax, depreciation and amortization of 106 million euros, according to its annual report.
Blackstone and Kirkbi recently teamed up on a 4.8 billion-pound ($6 billion) bid for Merlin Entertainments Plc, which operates Legoland resorts, announced last month. The investment firms were among those that took Merlin public in a 2013 initial public offering.
To contact the reporters on this story: Sarah Syed in London at ssyed35@bloomberg.net;Aaron Kirchfeld in London at akirchfeld@bloomberg.net
To contact the editors responsible for this story: Dinesh Nair at dnair5@bloomberg.net, Amy Thomson, Ben Scent
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