Tomkins to sell auto safety business — sources

By Soyoung Kim

NEW YORK (Reuters) – British industrial company Tomkins has put its Schrader automotive safety component unit on the auction block, people familiar with the matter said.

Barclays Plc’s Barclays Capital and Goldman Sachs Group Inc are running the Schrader sale, which is expected to fetch less than $1 billion, these people said.

Canada’s biggest private equity firm, Onex Corp, and the Canada Pension Plan Investment Board (CPPIB), which manages the country’s national pension fund, bought Tomkins Plc for $5 billion, including debt late last year, in one of 2010’s largest leveraged buyouts.

The Schrader unit makes tire pressure monitoring systems, a rapidly growing segment of the auto industry thanks to tighter safety regulations around the world that require systems that prevent tire failure.

Schrader customers include General Motors Co, Ford Motor Co, BMW AG, Nissan Motor Co Ltd and Fiat SpA among other auto manufacturers.

The auction, launched this week, is expected to draw interest from a private equity firms and strategic buyers, companies that operate in the same industry as the seller, these people said.

Tomkins, which also makes industrial hoses and bathtubs, was once one of Britain’s largest industrial groups and dubbed the “buns to guns” conglomerate in its 1990s heyday because it owned both food group Rank Hovis McDougall and .357 Magnum maker Smith & Wesson.

Its stable of companies includes Gates, the U.S. maker of belts and hoses for cars and machines.

Representatives for Onex, CPPIB, Barclays and Goldman Sachs were not immediately available for comment. (Reporting by Soyoung Kim; editing by Andre Grenon)