UBS Warburg is preparing to lead a debt financing package backing the $300 million acquisition of Nellson Neutraceutical by a partnership between Fremont Partners and existing management. The San Francisco-based sponsor is putting approximately $180 million in equity into the deal, and the leverage will consist entirely of bank financing in the form of an institutional loan, according to one banker. Details on terms, pricing and date of launch could not be ascertained. An official at Fremont declined to comment, and UBS bankers did not return calls by press time.
Fremont and management are buying the Irwindale, Calif., nutrition bar manufacturer from Artal Luxembourg, a European private equity shop. Last year, Nellson's EBITDA came in at more than $40 million, therefore the financing will create total leverage of three times.
Fremont is acquiring Nellson through its Fremont Partners III fund, which attracted $920 million in commitments last year. The fund focuses on middle-market opportunities, and other portfolio companies include Vantage Building Products and Kinetic Concepts. It typically holds its investments for four or five years. Investors in the fund include the Bill and Melinda Gates Foundation, General Motors Asset Management, Verizon Asset Management and Vanderbilt University.