Baring Private Equity Asia portfolio company Yingde Gases has completed an initial public offering (IPO) on the Hong Kong Stock Exchange, raising HK$3.16 billion ($408 million; €273 million).
Following the IPO in October, Baring has a stake of 12.77 percent in the company, according to documents Yingde filed with the Hong Kong Stock Exchange. It is unclear whether the firm has diluted part of its stake. Baring declined to comment on the details of the IPO.
In June 2006, Baring backed the management buyout of Yingde. The investment comprised of a $14 million equity injection in the company and a loan facility of $20.2 million. The loan facility broke down to a loan worth $14.2 million and a convertible loan worth $6 million. The funding enabled Yingde’s management to acquire a 48.5 percent stake in the company from Torch Automotive Group, a Shenzhen-listed company. Baring made the investment from Baring Asia Private Equity Fund III, which closed on $490 million in 2006.
Shanghai-headquartered Yingde Gases is engaged in the construction, production and operation of industrial gas plants. It supplies gases such as oxygen, nitrogen, argon and other specialty gases to the steel, petrochemical and mining sectors, among others. The company currently has 20 industrial gas production facilities and is developing another 12.
“We are proud to have played a role in the successful expansion of this business from six operating gas plants in 2005 to over 20 around the country as of the end of last year,” Jean Eric Salata, founder and CEO of Baring Asia, said in a statement.
Two other private equity-backed companies are also currently headed towards public offerings on the Hong Kong Stock Exchange. China Pacific Insurance, a portfolio company of The Carlyle Group, has received approval from the China Securities Regulatory Commission to list up to 990 million of its shares overseas. moving the insurer closer to raising at least RMB23.3 billion ($3.4 billion; €2.3 billion) in an IPO in Hong Kong.
Simultaneously, China Forestry Holdings Group, a Chinese forestry plantation operator backed by Carlyle and Partners Group, has published a draft prospectus and intends to raise up to $203 million through a listing on the Hong Kong's exchange.
Established in 1997, Baring Asia is currently investing from Baring Asia Private Equity Fund IV, which closed on $1.52 billion in May 2008. The fund makes growth equity investments and mid-market buyout investments in companies with enterprise values of between $100 million and $500 million in the alternative energy, media, financial services, consumer and industrial sectors. The fund is primarily focused on investments in China, India, Japan, Singapore, Hong Kong and Taiwan.
In October, Baring Private Equity Asia acquired a 16.5 percent stake in Hsu Fu Chi, a Chinese confectionary group listed on the Singapore Exchange, for a consideration of $135 million. A month earlier, the Hong Kong-based private equity firm invested $42 million for a significant minority stake PERA Global, a Chinese technology company.