BC Partners, the private equity group that owns the troubled estate agent Foxtons, faces pressure on its €1.1bn (£1bn) purchase of Dometic, the Swedish-based supplier of mini-bars and fridges for boats and caravans.
Banks including Nordea and ICG are understood to be looking to appoint UK-based restructuring specialists by the end of the month to renegotiate the terms of loans to BC for its Dometic purchase. The loans are believed to total €800m.
There are fears that Dometic, overseen by BC's London office, is struggling in the credit crunch and could break its current loan conditions.
Potential restructuring appointees include Close Brothers and Houlihan Lokey, as well as the big four accountants, Ernst & Young, Pricewaterhouse-Coopers, Deloitte & Touche and KPMG.
A restructuring source said: "The banks are looking at appointing a team to advise them in the next couple of weeks."
Another source close to BC said Dometic is performing better than perceived by the market and that the private equity group is not close to appointing its own restructuring adviser. "Clearly the company has been affected by trading difficulties in the US, but the company is getting through the difficulties," said the source.
The US is one of Dometic's three key regions, along with Europe and Asia Pacific. BC bought Dometic from the Swedish private equity group EQT, which had taken over the company from Electrolux in 2001.
BC is best known for its £360m purchase of Foxtons, the London estate agent founded by Jon Hunt, in May 2007, less than three months before the start of the credit crunch. Mr Hunt, who set up the estate agent in 1981, is reported to have lent BC £50m to take Foxtons off his hands. It is believed that this will not have to be repaid, as Foxtons has not performed to Mr Hunt's forecasts.
Last week BC admitted it had bought the agent at the wrong point in the market cycle, and that it was now breaching its loan covenants as a result of the collapse of the housing sector. BC had set up its business model to allow for a 30 per cent dip in the market, but housing sales have fallen by around double that figure.
BC is thought to have borrowed around £260m to buy Foxtons, and could inject some more of its own cash to help convince its lenders, Bank of America and Japanese giant Mizuho, to relax debt conditions.
The private equity group has a string of other high-profile investments. These include Baxi, the leading UK heating products group that BC bought for €984m in 2004, and Fitness First, the gym chain that cost €1.2bn a year later.
Since it was established in 1986, BC has invested in 67 companies worth more than €60bn. As well as London, BC has offices in Geneva, New York, Milan, Hamburg and Paris.Reuse content