NEW YORK – Canadian private equity firm Onex Corp is preparing to sell The Warranty Group, a provider of extended warranty contracts, which is expected to fetch more than $1 billion, two people familiar with the matter said this week.
Onex has hired Goldman Sachs , Morgan Stanley and Citigroup to find a buyer for the business, according to one of the people, who wished to remain anonymous because they are not permitted to speak to the media.
The Warranty Group, Goldman and Morgan Stanley declined to comment. Citigroup and Onex did not respond to requests for comment.
Onex bought The Warranty Group from insurance broker Aon Corporation in 2006 for $710 million. Onex put around $510 million of equity into the deal, which also saw the Warranty Group's management participate with a substantial investment.
The Warranty Group provides extended warranty contracts for an array of consumer goods, including automobiles, consumer electronics and major home appliances. It also provides credit insurance and other specialty insurance products.
The Chicago-based company operates with over 1,900 employees and with operations and offices in 31 countries, according to Onex's website.
(Reporting by Soyoung Kim and Jessica Toonkel in New York; Editing by Leslie Adler)