Aurelius reveals debt structure on Lufthansa carve-out; Inflexion looks to US for healthcare exits

Bain Capital opts to waive conditions on Caverion bid to keep tender offer open.

We’re treating you to not just one but two deep dives today. First, we speak to Aurelius about the firm’s carve-out of Lufthansa’s catering business LSG Group, including a look at the debt structure of the deal.

The other deep dive sees me speak to Inflexion about the advantages – and difficulties – of expanding European healthcare businesses in the US.

We then look at a report that KKR is going to invest in a financial comms company, Equistone’s acquisition of a couple of out-of-home businesses and some promotions at law firm Skadden.

But first, will there be another twist in the Bain Capital, Triton and Caverion saga?

It ain’t over yet…

We wrote in depth yesterday about what could be the final leg in the race between Bain Capital and Triton Partners to take control of Finnish construction firm Caverion, as the target’s board switched its support from Bain to Triton after Bain’s deadline to provide another improved offer lapsed.

Bain’s tender offer was conditional on the board’s recommendation, but yesterday afternoon the private equity firm said it would waive that and keep its offer open. It’s due to expire on 17 April 2023 and requires Bain to control more than 50 percent of the shares and voting rights in Caverion.

It might be that Bain is hoping that shareholders agree with its argument that Triton’s bid could get caught up with antitrust regulators. So maybe this story has a little more to run yet – watch this space.

The debt question

Aurelius Private Equity made a lot of headlines yesterday after announcing a carve-out of airline caterer and onboard retail provider LSG Group International from Deutsche Lufthansa.

I spoke to Dirk Markus, founding partner at Aurelius, about the deal. We touched on a lot of things in the article, which you can read here, including why the firm is betting on an air travel services as well as some of the particular complexities of carving out a business such as this.

But one part I wanted to raise in the Dealflow was the issue of the capital structure.

Debt costs had been rising for 12 months before the collapse of Silicon Valley Bank in March made life even more difficult.

“Would financing have been easier a year ago?” Markus told me. “Definitely. Easier and cheaper. This is a larger midcap, those can be done. If this business was five times as large, would we have been able to finance it? I’m not sure.”

Some recent deals have introduced novel capital structures such as flexible payment schemes, including Regent’s carve-out of Pearson’s online programme management business. But Aurelius took the traditional bank financing route, with debt funds considered as a backup.

“We managed to get a classic bank financing that has some ABL component as well as a cash-based component,” said Markus.

The issue of capital structures is one we expect to revisit more and more. I’d love to get your thoughts on what you’re seeing and what you expect – send them over to me at

We’re also seeing more and more carve-outs lately. Check out Nina Lindholm’s interview with Cinven partner Pontus Pettersson from earlier this week on why that trend is growing.

Regulatory hurdles

Next up, I spoke to Ben Long, partner and head of the healthcare sector at Inflexion, about the advantages of expanding European healthcare companies in the US – as well as the obstacles to entry.

You can read all about that here, but as an extra treat in the Dealflow I wanted to share some thoughts from Long that didn’t make it into the article, on the cross-border opportunities for medical devices in Europe.

Long said that there are two separate areas. One is the commodity, or ‘ward products’, where users are indifferent to brand and levels of regulation are lower. Then there is the surgical or ICU market, where Inflexion is focused, and breaking into markets is harder.

“If you’re doing a heart operation or even replacing a hip, you don’t really want to have to learn how to use a new device. You find a brand that you trust with no complications, and then you just use that over and over again.

“Sales reps in medical devices are very different from, say, sales reps in pharma, who will turn up for 15 minutes with a one-page flyer, explain why the product’s good and the clinical trial outcomes, give him a coffee and then follow up. A rep that sells a medical device used in surgery will be in the surgery during the procedure. For advanced products, the surgeon will actually rely on the rep to let them know how to deal with complex situations. It’s an extremely highly trained position, largely comprised of people who used to be in clinical work themselves.”

Inflexion’s exposure to the medical devices sector comes partly from SteriPack, an Irish company whose buyout it led in July 2022. One product it has worked on was to create covid test for the Gates Foundation that does not require liquid – meaning there needs to be no cold chain at any point, allowing it to be used in hot developing countries. The product is now going through trials with a university in South Africa to be adapted for tuberculosis testing.

“Because you can solve these complex problems, that creates the conversation with the medical device manufacturer and then you can turn that into a wider conversation. Can we do the manufacturing? Can we do the packing? Can we do the injection moulding? Then get it a bit more end to end, which is starting to work quite well.”

For more from Inflexion, the US opportunities-focused article is here.


KKR is close to signing a deal to buy a large stake in financial communications company FGS Global (of which it is a client), according to people with knowledge of the matter spoken to by the Financial Times.

The deal is expected to see KKR acquire more than 30 percent of FGS from senior employees and advertising firm WPP, which owns about 57.4 percent of FGS, the FT report said.

KKR declined to comment when approached by PE Hub Europe.


Equistone Partners Europe-backed Talon has completed the acquisition of Evolve and Novus Canada, representing an additional £100 million ($124.6 million; €114 million) in billings.

Evolve, headquartered in London, is an international out-of-home (OOH) business.

Novus Canada is an OOH media agency based in Vancouver, British Columbia.

The bolt-on acquisitions of Evolve and Novus are the first deals announced since Equistone’s investment in Talon in July 2022.

Equistone has supported Talon’s organic growth through the recent opening of new offices in Asia-Pacific and the Middle East, according to a release.

London promotions

And finally, law firm Skadden has promoted two lawyers to partner in its London practice. George Gray becomes partner in the firm’s private equity group, while Andrea Spadacini is promoted on the M&A team.