Alchemy Partners, led by accountant Jon Moulton, has launched a £161.4m cash bid for double glazing company, Anglian Group.
The recommended offer will take Anglian private by backing a management buyout team at the Norwich-based company.
KPMG, who is also auditor of the company, is working closely with Alchemy, providing commercial, financial and tax-based due diligence support for the private equity house.
The firm had previously worked with Alchemy on its failed bid to buy Rover Cars from BMW last year.
Oliver Tant, head of private equity at KPMG Transaction Services, said: ‘We checked that the nuts and bolts of what the management said about the business today were a reasonable assessment, both financially and commercially.’
Last year Anglian was forced to issue a profits warning after production was hit by computer problems.
The company had also suffered rising fuel and material costs in recent months.
Anglian’s management team will feature only one current board member, sales and marketing director Lawrence Condon.
Neither Edward Boss, Anglian’s chief executive, nor finance director Robert Aitken will be joining the new team.
Paul Bridges, a chartered accountant and partner at Alchemy, said: ‘We are always looking for companies that fit our criteria of being undervalued by the market, and we felt we could create more value with Anglian in a private scenario.’
Alchemy made the offer through Naiglan Investments, a wholly owned subsidiary, valuing the company at 250p per share, a premium of 55% on the average share price over the past six months.
KPMG’s Tant anticipated that the deal would be accepted by shareholders as it had the backing of those directors who were not taking part in the deal.
David Perry, chairman of Anglian, said: ‘The independent directors believe the offer is in the interests of shareholders and that it represents fair and reasonable value for the company.’
Profits at Anglian fell 11% from £30.5m to £27.2m in the year to April 2000, and interim profits last November were £10.7m on a £128m turnover.
In a statement, Anglian admitted it had seen a ‘challenging’ year.
Anglian was the subject of a management buyout more than ten years ago.
It floated in 1991 with its share price hitting a high of 389p in 1994.
After its current management took over in 1996 the company saw 20% annual earnings growth until the computer problems in 1999.