Warburg Pincus, Blackstone and Advent International were all said to have made the second round of bidding last month according to four Reuters sources.
A $1.5bn sale would represent a huge multiple of the company’s reported $90m EBITDA and a strong exit for Aurora, which invested $500m in San Diego-based Mitchell in 2007 as part of an investor group including General Electric Pension Trust.
They picked up the business from fellow private equity firm Hellman & Friedman.
California-based Mitchell provides software and information to insurance companies and collision repair facilities to help them estimate the cost of parts and labour.
Herald Chen, co-Head of KKR’s technology investing group, said, “We believe that Mitchell represents an attractive investment in a market leader in an important market segment.
“For more than 67 years, Mitchell has provided products that help businesses and individuals restore their lives and property.
“We are excited to partner with Mitchell’s executive leadership team and support the company’s future growth plans as Mitchell continues to invest in its customers, its people and its market-leading technology.”
The sale follows January’s purchase of fellow claims software maker CCC Information Systems by retail-focused buyout house Leonard Green & Partners, which picked up the asset from the Middle East’s Investcorp.
Although full financial terms of the deal were not disclosed, Investcorp said in a statement that the sale unlocked more than $550m in proceeds for the firm and its investors.
Investcorp bought Chicago-based CCC in February 2006 for $495m.
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