(Reuters) - Canadian private equity firm Onex Corp
Auto parts and building products maker Gates is a division of Tomkins, which Onex and CPPIB jointly bought in 2010 for about $5 billion.
The sale is expected to close later this year, the companies said on Friday.
Proceeds from the sale to the Onex Group, including co-investors, would be about $2.0 billion, of which Onex Corp's share would be about $550 million, including carried interest. CPPIB's share would be about $1.5 billion.
Reuters reported last week that Blackstone was close to a deal to buy Gates.
Denver, Colorado-based Gates, which filed for an IPO in December, sells products ranging from power transmission systems to acrylic bathtubs in more than 120 countries.
Gates generated $2.9 billion in sales and $536 million in adjusted earnings before interest, taxes, depreciation and amortization in the year ended September 28, according to a regulatory filing.
Onex said in March it would sell The Warranty Group, a provider of extended warranty contracts, to an affiliate of TPG Capital Management LP
Goldman Sachs Group, Bank of America Merrill Lynch and Citigroup served as financial advisors to Gates, while Latham & Watkins LLP served as legal counsel.
Morgan Stanley, Barclays, XMS Capital and Deutsche Bank served as financial advisors to Blackstone, while Simpson Thacher & Bartlett LLP served as legal counsel to Blackstone.
Blackstone said it has secured committed debt financing to be arranged by Credit Suisse, Citibank, Goldman Sachs, Morgan Stanley, Deutsche Bank and UBS.
(Reporting By Sneha Banerjee in Bangalore, additional reporting by Soyoung Kim.; Editing by Sriraj Kalluvila)