Baring Private Equity Asia has agreed to back the management buyout of NASDAQ-listed Harbin Electric. The Hong Kong-based firm along with the company’s CEO Tianfu Yang submitted a proposal to the board of the Chinese electric motors maker Monday offering $24 per share, according to a company statement.
A letter from law firm Howard G. Smith which is investigating the fairness of the proposal on behalf of shareholders, valued the cash transaction at around $752 million.
Yang currently owns 31.1 percent of Harbin’s common stock. The company statement noted that according to the proposal letter, the transaction would be financed with a combination of debt and equity capital. Yang, which has hired Goldman Sachs as advisors, will partner with Baring to provide the equity portion of the deal.
Harbin Electric, headquartered in Harbin, China, is a developer and manufacturer of electric motors. Its major product lines include industrial rotary motors, linear motors, and specialty micro-motors. The company operates four manufacturing facilities in China located in Xi'an, Weihai, Harbin, and Shanghai.
Shares of Harbin Electric were trading at $23.22 at the time of writing.
At last mention, pan-regional investor Baring Private Equity Asia was targeting commitments of $1.75 billion for its latest fund, Baring Asia Private Equity Fund V, a source told PEI Asia in July.
Baring Asia Private Equity Fund IV closed on over $1.5 billion in May 2008, surpassing its $1 billion target. That fund received re-ups of 154 percent from existing investors and drew commitments from another 40 institutional investors, the firm said at the time of the predecessor fund’s close.