How EQT bought Siemens’ €2 billion business

Author: Danielle Myles | Published: 10 Feb 2015

EQT’s acquisition of a majority stake in Siemens’ Audiology Solutions reveals European private equity (PE) firms’ willingness to pursue well-established targets.

The circa €2.15 billion ($2.43 billion) deal, reportedly the Swedish firm’s biggest equity investment to date, closed last month.

The deal is notable for its use of a new-style management participation vehicle and novel warrants to accommodate the German seller’s rollover interest and minority shareholders’ anonymity.

But its more immediate market impact is in showing that European funds can succeed in diversifying their investment strategies.

"It could be an indication for PE firms to set their sights a little higher, and also look at bigger and more-established targets," said Marcus Peter, partner at Bonn & Schmitt who advised EQT.

The region’s PE firms have historically targeted small-to-medium sized companies with high-growth potential. But Siemens’ hearing aid business – Audiology Solutions – was established nearly 15...