FRANKFURT/LONDON/MADRID, July 23 (Reuters) - U.S. investment company Apollo has halted discussions over a sale of its French glass bottle maker Verallia because it believes that better returns could be achieved from a stock market listing, sources close to the matter told Reuters.
A Paris listing could take place as early as September and value Verallia at about 4.5 billion euros ($5 billion) euros including debt, the sources said.
Apollo, which took control of Verallia in 2015, launched a dual-track process this year to gauge interest in both an outright sale and an initial public offering (IPO).
The U.S. company has received tentative bids from European investors Cinven and CVC Capital Partners as well as Canadian pension fund PSP Investments, one of the sources said, speaking on condition of anonymity.
But Apollo has suspended discussions until September to focus on an IPO, he said, with another source saying that packaging businesses such as Portugal's BA Glass were among potential bidders but were reluctant to buy the entire company.
Apollo, Cinven, CVC and PSP declined to comment while BA Glass representatives were not immediately available for comment.
For all the talk of an IPO, however, market conditions might not be conducive in the autumn and Apollo could yet resurrect a sale or a break-up of Verallia, the sources said.
Another source noted that if financing conditions remained strong, Apollo could eventually negotiate a satisfactory price with one of the bidders.
Barclays, which was initially focusing solely on the sale process, has now started working as a global coordinator on the mooted stock market listing alongside BNP Paribas, Citi and Deutsche Bank, one of the sources said.
Another source said the banks working on the IPO are on the lookout for investors willing to buy minority stakes.
Reuters reported on April 9 that Apollo was gearing up to list Verallia this year and the company subsequently confirmed plans to go public on Euronext Paris.
Verallia, Saint-Gobain's former glass bottle business, makes bottles and jars for Pernod Ricard, champagne house Dom Perignon and chocolate spread maker Nutella.
The company expects to post earnings before interest, tax, depreciation and amortisation (EBITDA) of roughly 550 million euros this year and is hoping to fetch a multiple of between 8 and 8.5 times its core earnings in an IPO, sources have said previously.
Rivals such as Vetropack, Owens-Illinois or Vidrala trade in a wide range of multiples, from 2.3 to 9.6 times EBITDA.
(Reporting by Arno Schuetze, Pamela Barbaglia and Andres Gonzalez Additional reporting by Abhinav Ramnarayan and Inti Landauro Editing by David Goodman)