Traders are citing the buyout of US company PetSmart announced today by BC Partners in a cash deal worth $8.7bln to be a prime mover in the pound’s fall so far in this session
BC Partners are a pan-European private-equity firm so it won’t necessarily be just a straight GBPUSD deal and we don’t know at this stage the component break-down. Or indeed how much has already been done, or the spare cash BC had laying around
The consortium has received fully committed debt financing in connection with the transaction. The transaction is expected to close in the first half of 2015 says the BC website
Raymond Svider, a Managing Partner at BC Partners said
We are very pleased to add PetSmart to our portfolio of investments. PetSmart is an iconic brand and the category leader in the growing pet retail industry. We look forward to working with management to continue growing PetSmart’s business and executing against its recently announced strategic initiatives said
BC Partners were founded in 1986 as a pan-European buy-out investor, and has grown and evolved into a leader in buy-outs, principally investing in larger businesses in the region and selectively in North America through its established network of offices in London, Paris, Hamburg and New York. It’s currently advising funds totalling over €12 billion and since inception has completed 85 acquisitions with a total enterprise value of €88 billion
As always with these M&As there will be much speculation as to how much FX is involved and therefore the impact on markets/price action is mainly conjecture but with GBPUSD still on the backfoot it all adds to the downside pressure.
Currently 1.5670 with bids into 1.5650 that I highlighted earlier giving enough support so far given its decline already from 1.5748 this morning. EUGBP 0.7929 still holding the range after another attempt on the highs into 0.7940
