A US investment fund that specialises in buying bankrupt and troubled companies is lining up a bid for luxury goods and crystal manufacturer Waterford Wedgwood.
Waterford's main lender, Bank of America, appointed Dublin-based Deloitte partner David Carson as receiver to the group this week.
The company's liabilities exceed its assets by €337 million. It is said to owe Bank of America about €120 million and its workers' pension fund had a €111 million shortfall last October.
Mr Carson announced yesterday that New York-based private equity fund KPS Capital Partners has formally signalled in a letter its intention to buy the group's assets, including Waterford Wedgwood and Royal Doulton.
He said that he and his colleagues in Deloitte's London office, who are acting as administrators to Waterford's British businesses, are working to agree the terms of a deal with KPS.
At the same time, Mr Carson added that, in the interests of maximising returns to creditors, he and the administrators are continuing to talk to other parties that have also expressed an interest in buying the group.
It emerged earlier this week that more than 10 potential suitors for Waterford have been in touch with the receiver. Sources have named likely buyers as other private equity funds, Oakhill Capital, Sun Capital and Hilco.
Mr Carson did not reveal what KPS is willing to pay for Waterford, or how a deal might be structured. A spokesman said that the receiver could not comment any further. KPS is a mid-ranking investment fund and has $1.8 billion under management.
According to its website, it specialises in buying troubled businesses, particularly those that are insolvent, operating in bankruptcy or burdened with excessive debts.
The fund has a track record dating back to the early 1990s of buying and profiting from "distressed" manufacturing industries. Some of the sectors where it has been active include the US motor parts industry.
According to the US media, it also has experience in dealing with trade unions and organised labour. Waterford's 800 Irish workers are largely unionised.
Waterford Wedgwood's chief executive, David Sculley, said the news was a critical step forward for the group.
"I look forward towards the successful completion of a deal," he said.
Waterford non-executive chairman Sir Anthony O'Reilly resigned on Monday. He and his brother-in-law have invested €400 million in the group and own 52 per cent of it. Sir Anthony has also guaranteed some of its debts.
Yesterday, directors Ottmar Kusal and Kevin McGoran stepped down from the main group's board, while Dr FA Wedgwood will leave the boards of Waterford Wedgwood plc and Waterford Wedgwood UK plc today.
