The Carlyle Group has looked to bounce back from its recent travails in China by taking a sizeable stake in a Chinese pipe manufacturer, and hiring two of Asia’s top executives to strengthen its Asian investment team.
Carlyle has paid $80 million to take a 49 percent stake in Yangzhou Chengde Steel Tube, China’s leading supplier of seamless steel pipes to the construction and energy industries. The investment has been made from Carlyle Asian Partners II, the firm’s $1.8 billion fund for non-Japanese Asian deals.
The deal, which has already received regulatory approval, will be welcome news for Carlyle, which has recently struggled to complete a minority investment in Xugong, a construction machinery maker, following government opposition.
The buyout firm has also recruited two senior directors to bolster its Asian deal team. Patrick Siewert has joined from Coca-Cola to lead the firm’s investments in consumer-related businesses, and Herman Chang has been recruited from Delphi with a remit to target industrial investments.
Siewert, who described Asia as “the most exciting place in the world for the development of consumer-related businesses”, will be based in Hong Kong but will target opportunities across the region. As Coke’s chief operating officer for Asia-Pacific, he was the drinks-maker’s top executive in the region and had 10,000 people in his charge.
Chang has over 20 years’ industrial experience, initially at General Motors and more recently at auto-parts maker Delphi, where he has served as managing director of its Asia-Pacific operations and president of its Chinese business. He has operated in Asia for the last ten years.
Carlyle is one of the most active private equity investors in Asia. Its Asia Partners division manages about $2.5 billion across two funds, taking control and minority investments in all Asian countries except Japan, where it operates a separate fund.