Smarte Carte International Holdings Inc., whose luggage carts, lockers and massage chairs are ubiquitous in U.S. airports, has been acquired by 3i Group PLC, a British buyout firm that is pushing into North American infrastructure, said people familiar with the matter.
The firm paid $385 million for Smarte Carte, a sum that includes the company's debt, one of the people said. The firm plans to eventually refinance the deal with new debt, the people said. Management of closely held Smarte Carte will retain a stake in the 50-year-old St. Paul, Minn., company alongside 3i, the people said.
The purchase comes at a time when many investment firms around the world are flush with cash and are scouring the U.S. for infrastructure deals. Despite the Trump ad- ministration's pledges to boost private investment in roads, airports and utilities, the firms are finding limited opportunities to put their cash to work.
The Smarte Carte deal shows how these firms remain somewhat restricted to the types of infrastructure assets and services in which they have long traded rather than pursuing new privatizations and public-works projects.
Investors committed $60 billion to private infrastructure funds last year and have added more than $40 billion this year, according to data provider Preqin. They have been drawn by fairly reliable returns that often outperform private-equity funds that tend to make riskier bets, such as on corporate buyouts, Preqin data show.
Meanwhile, deals are down in both number and dollar volume, according to the data provider. It says higher prices are resulting from more firms angling in a smaller pool of opportunities.
London-based 3i hasn't yet raised an infrastructure fund. In March, it hired Rob Collins, who once ran Morgan Stanley's infrastructure business, to hunt for investments in North America using its own balance sheet.
Smarte Carte is well-trod territory for private-equity firms. 3i will be the seventh firm to take over the company since its founder first sold a controlling interest to a New York buyout shop in 1993.
That firm, Castle Harlan Inc., sold Smarte Carte to a Dallas investment firm three years later for $113.5 million, a deal in which the seller said it made 25 times its cash investment. It was sold again in 1998 to Blum Capital Partners. Smarte Carte buckled under nearly $200 million of buyout debt, though, and filed for bankruptcy protection in 2005.
The company's creditors took it over and sold it to Macquarie Bank Ltd. the next year for $270 million. The Australian bank then flipped the company in 2014 to Fortress Investment Group LLC, which has sold it to 3i.
3i approached Fortress to head off a competitive auction, according to a person familiar with the latest sale. Smarte Carte's luggage trolleys, phone chargers, lockers, massage chairs and strollers are in all but one of the 50 largest U.S. airports.
BY RYAN DEZEMBER