New Mountain Capital Is Said to Mull $3 Billion Zep Exit in 2021


New Mountain Capital is considering a sale or initial public offering of Zep Inc. in 2021 that could value the cleaning products firm at about $3 billion, according to people with knowledge of the matter.

The New York-based buyout firm is working with an adviser to explore strategic options for the company, said the people, who asked not to be identified because they weren’t authorized to speak publicly. A final decision hasn’t been made and New Mountain could decide to keep the business, the people said.

A representative for New Mountain declined to comment. A spokesperson for Atlanta-based Zep didn’t respond to a request for comment.

The decision to look at a sale comes as sales of cleaning products have surged during the Covid-19 pandemic. Bain Capital is exploring an exit of its food hygiene and cleaning portfolio company Diversey Inc. for as much as $6 billion, according to people familiar with the matter.

New Mountain agreed to take Zep private in 2015 in a deal valued at $692 million, including debt. The firm subsequently bought and merged the company with Afco in 2017 and Ecoclear Ltd. this year. Zep’s brands include Black Magic and TimeMist, according to its website.

©2020 Bloomberg L.P.

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