* Charterhouse buys energy research and consultancy firm
* Deal gives Wood Mackenzie $905 million enterprise value
* Proceeds of up to 36.2 mln stg for Candover Investments
* Biggest European private equity acquisition this year
* Candover Investments shares up almost 10 percent
(Adds analyst comment)
By Quentin Webb and Julie Crust
LONDON, June 19 (Reuters) - Troubled Candover agreed to sell energy research firm Wood Mackenzie to rival Charterhouse for an enterprise value of 553 million pounds ($905 million), in this year's biggest European purchase by a private equity firm.
Although the sale price is below the 650 million pounds originally mooted by newspapers, the deal announced on Friday provides a welcome cash infusion for Candover's listed parent, Candover Investments Plc, which may get as much as 36.2 million pounds. Its stock rose almost 10 percent.
Once one of Europe's biggest private equity houses, Candover has seen a string of its investments plunge in value and it suspended new investments by its 2008 fund. The listed vehicle, which owns 6.3 percent of Wood Mackenzie, is itself in talks on a takeover of all or part of its equity.
Oriel Securities analyst Iain Scouller said the deal would have a "transformational impact on Candover's balance sheet", cutting net debt and soothing market fears about bond covenants.
"We think the improvement in the balance sheet means it is less likely that the board and shareholders will accept a `low-ball' bid for the company," he wrote in a note to clients.
"Instead we think it more likely that Candover will aim to realise investments over time and return some capital to shareholders." Candover Investments shares rose 9.7 percent to 295 pence by 1200 GMT, shedding some of their early gains. The stock has bounced from a more than 10-year low of 78-1/2 pence set in late March but remains at a fraction of a 2,320 peak set just over a year ago.
SPRINGER
The deal gives Edinburgh-based Wood Mackenzie an enterprise value of about 14.6 times its 2008 earnings before interest, tax, depreciation and amortisation (EBITDA) of 38 million pounds. Candover owns roughly two-thirds of Wood Mackenzie, with staff holding most of the rest.
Charterhouse's bid topped competing offers from rivals Bain Capital, Hellman & Friedman and Warburg Pincus, a person familiar with the matter said last week. Earlier interest had also come from consultancies and trade rivals.
Candover Investment's proceeds include 19.6 million pounds in cash, a possible 1.9 million more later and 16.7 million in carried interest payments from the 2001 Fund, which first invested in Wood Mackenzie four years ago.
Candover Chairman Gerry Grimstone said the company's plan to stabilise itself was making progress and the deal would bolster cash reserves.
Candover is also trying to sell 49 percent of German academic publisher Springer Science and Business Media, which it owns alongside Cinven, according to people familiar with the matter.
FINANCING
Low-profile Charterhouse, led by former Bankers Trust managing director Gordon Bonnyman, said in April its latest buyout fund Charterhouse Capital Partners IX had raised 4 billion euros.
The deal marks the largest acquisition in Europe by a private equity group in 2009, according to Thomson Reuters data.
Charterhouse was advised by HSBC and Nomura, according to people familiar with the matter. The deal is a boost for the duo who also advised KKR on the biggest buyout of the year globally, the $1.8 billion purchase of Oriental Breweries.
Goldman Sachs advised Candover.
HSBC, Lloyds Banking Group and Nomura arranged a loan to back the sale, banking sources told Reuters Loan Pricing Corp this week, replacing an earlier staple financing provided by Lloyds.
(additional reporting by Simon Meads; Editing by David Holmes, John Stonestreet) ($1=.6113 Pound)