Alchemy and Triton Partners have collected non-binding offers for the sale of European telecoms group Lebara, according to three sources familiar with the matter.

Non-binding offers were submitted at the end of March, two of the sources said.

Sellside advisor Guggenheim is currently reviewing a handful of bids for the SIM-only mobile phone operator and is in the process of selecting parties for the second round of the auction, two of the sources said.

A lender education was conducted in February, three sources said at the time.

The sale process has been predominantly sponsor-focussed with Bain Capital, Cinven and Waterland among the funds that initially showed interest, two of the sources and an additional source said. Telecoms group Liberty Global [NASDAQ:LBTYA] had also shown initial interest, two of the sources said.

A potential value creation strategy for the winning bidder could be to separate the business into each of its separate regions with a view to then sell some of its units to local competitors, one source said.

Lebara operates in the UK, Netherlands, Germany, France and Denmark with license agreements for the use of its brand in Spain, Switzerland, Saudi Arabia and Australia.

The company is projected to generate EBITDA of GBP 70m this year, as reported in the press. Lebara has some 4m customers, the report added.

The company is expected to attract limited interest from infrastructure funds given that it doesn’t own a physical network, two of the sources added. Lebara operates as a Mobile Virtual Network Operator (MVNO), using agreements with other telecom operators to provide services for customers.

Lebara’s owners last year began weighing options for the company which included a possible sale or IPO, the Financial Times said. Lebara was established in 2001 with the aim of providing better value alternatives to established category players.

Alchemy and Triton took over the company in early 2020 from its previous owner, a Swiss family office called Palmarium, via a debt-for-equity swap workout. The financial restructuring had taken place following a series of financial reporting issues and debt terms breaches.

Bain, Cinven and Triton declined to comment. Alchemy, Lebara, Liberty, Guggenheim and Waterland did not respond to requests for comment.

Lebara on Debtwire Restructuring Database (access required)