Clayton, Dubilier & Rice has agreed to invest $500 million in CHC Group (NYSE: HELI) through the purchase of convertible preferred shares to be issued in a private placement. Expected to close by the end of 2014, the deal would give CD&R a 45% ownership stake (as-converted, pro-forma) in CHC, which provides offshore flying services to the oil and gas industry. That stake could change based on CHC’s planned $100 million rights offering to existing shareholders. CD&R has agreed to purchase any leftover shares from the offering, meaning the firm’s total investment could reach as much as $600 million. Morgan Stanley acted as placement agent for CHC in the transaction.
With approximately 4,500 full-time employees, CHC has one of the industry’s largest fleets of heavy and medium commercial helicopters in roughly 70 bases on six continents. The company reported $1.8 billion in total revenue for its FY2014 ending April 30. First Reserve, which backed CHC in 2008 and took it public earlier this year, would retain about a 29% ownership stake.