Kiloutou close to buying BM Location

Kiloutou is close to completing the acquisition of BM Location, the third largest general rental company in France and part of the Cat Rental Store network in Europe.

A source with knowledge of the deal told IRN that the deal was 99% completed and was likely to be announced within the next couple of weeks.

Xavier du Boÿs, Kiloutou's chief executive, confirmed to IRN that Kiloutou was in "exclusive negotiations" with BM Location but would not make any further comment.

The two companies have been talking for several weeks. It is understood that Kiloutou was prompted to act quickly following Loxam's recent takeover of Locarest. That deal will boost Loxam's revenues into the €750 million range and gives it a commanding lead over Kiloutou, which will post revenues of around €300 million this year.

The acquisition of BM Location would give Kiloutou an additional 90 depots - to add to the almost 300 of its own - and additional revenues of around €80-85 million. It would also allow it to diversify into earthmoving equipment - BM Location is the rental business of Caterpillar dealer Bergerat Monnoyeur. Kiloutou's strength is in smaller tools and equipment.

The deal would mean that the two biggest French renters would have an approximate 35-39% share of the €3 billion general equipment rentals market in France.

The sale of BM Location could be interpreted as a setback in the development of the Cat Rental Store network in Europe. The last three years has seen the UK Cat dealer, Finning, sell its Hewden rental business and other Cat dealers in Scandinavia and Spain have also scaled back their investment in their rental divisions.

Earlier this year Kiloutou was sold by its private equity owner Sagard Private Equity to another private equity company, PAI Partners, for €535 million.

At the time, PAI Partners said Kiloutou would embark on a further growth phase, making acquisitions, extending its depot network and establishing start up rental operations in countries outside of France.