Buyout group Clayton Dubilier & Rice (CD&R) has started preparations for a potential stock market listing of Mauser just a year after acquiring the German packaging group for around 1.25 billion euros ($1.42 billion), two sources familiar with the matter said.
The investor has asked banks to shortly pitch for roles in organising the listing, the people said, adding that an IPO may take place late in 2015 or in 2016.
"The company has performed well and markets are hot," one of the people said, adding that CD&R is anxious to list the asset before equity investors become less receptive to initial public offerings (IPOs).
"It would be a quick flip, but we have seen private equity do that before," another source said, pointing to Hellman & Friedman, which in 2014 tried to IPO German classifieds group Scout24 less than a year after buying it, but then pulled the deal as markets deteriorated.
CD&R is expected to list only a minority stake in Mauser to benefit from any upside in the company's further development, the sources said.
Having been under the ownership of private equity groups before, Mauser's finances and cost structures are in good shape and not much has remained for CD&R to do to drive returns, they added.
Since the acquisition by CD&R, Mauser has made smaller acquisitions and opened new production sites, but has not engaged in major cost cuts.
CD&R bought Mauser from Dubai International Capital (DIC), which had acquired it from JP Morgan's buyout unit in 2007 in an 850 million euro deal.
CD&R declined to comment while Mauser could be not reached for comment.
Mauser makes packaging equipment such as cans and drums for transporting medical waste and other hazardous chemicals. It has 4,400 employees and annual sales of 1.3 billion euros.
At the time of the sale to CD&R, Mauser's earnings before interest, taxes, depreciation, and amortization were expected to reach 154 million euros in 2014. A more recent figure is not available.
Peers trade at 9 times their expected core earnings. If Mauser reaches a similar multiple in a potential IPO it would be valued at roughly 1.4 billion euros.