Private Equity Deals & Transactions

FountainVest to lead US firm China expansion

The China-focused firm has teamed with CPPIB for the buyout of Key Safety Systems

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Hong Kong-based private equity firm FountainVest Partners has become the largest shareholder in US-based car safety component manufacturer Key Safety Systems (KSS), teaming with the Canada Pension Plan Investment Board, according to a statement.

Financial details of the transaction were not disclosed, but FountainVest becomes the largest shareholder, with Canadian LP giant CPPIB coming in as a co-investor on the deal.

The firms join Crestview Partners and company management as shareholders, with Jason Luo continuing as chief executive a member of the company’s board of directors.

“KSS has emerged as an industry leader well recognised for its reliable technology, high quality global manufacturing footprint, customer focus and diversified revenue base. We see excellent growth prospects for KSS in both the rapidly expanding Chinese market and the broader global market as customers seek to improve the safety of their cars,” Frank Tang, chief executive and founder of FountainVest, said in a statement.

KKS designs, develops and manufactures safety components for cars such as seat-belts, airbags and steering wheels, with its five main technical centers located in the US, Germany, China, Japan and South Korea.

Barry Volpert, co-founder and chief executive of Crestview said, “We look forward to continuing our association with and investment in KSS and welcome FountainVest to this consortium. Together with KSS’s management, we have built a strong company that is poised to continue its consistent, record setting performance.”

The transaction is not the first in which Crestview has teamed up with a Chinese private equity firm to expand a US business into the Asian country.

In October last year, CITIC Capital Partners teamed with the New York private equity firm in a buyout of Stackpole International worth around $512 million, Private Equity International reported earlier. CITIC Capital Partners is a Chinese private equity fund with both China-focused vehicles and international funds.