Chapter 24
Seat SpAa
On Saturday May 10, 1997, Jonathan Lavine, a principal at Bain Capital, a U.S. private equity firm, was preparing an investment memorandum for Bain Capital’s credit committee to make a bid for Seat SpA, the largest publisher of Yellow Pages and White Pages in Italy. Seat was being sold as part of the Telecom Italia privatization process undertaken by the Italian government. He had just reviewed the paper with Mark Nunnelly, the Managing Director with whom he was working on the investment. They were both excited about the opportunity, but were also cautious, as this deal was in a country with which they had little or no experience. Adding to the complexity was the fact that Seat would be one of the largest investments the firm had ever made.
Bain Capital had joined a local Italian consortium assembled by Investitori Associati and included Banca Commerciale Italiana, De Agostini, BC Partners, and CVC Capital Partners. Bids were due to be submitted in one month.
As Jonathan contemplated the deal, several issues came to mind. Bain Capital did not have much deal-making experience in Italy, or Europe for that matter, although it had taken part in investment discussions with local Italian partners in the past. Since Bain Capital was an American private equity firm, Jonathan was concerned about Italian country risk exposure and how it could affect cash flows and expected returns. Apart from the economic risks, there were political considerations that were harder to ...
