Hupomone, AIF to invest $40m in abalone specialist

The two firms will back Oceanus, which is listed on the Singapore stock exchange and has operations in China. The company is seeking $45m to scale up its production and brand marketing activities.

Asian private equity firms Hupomone Capital Partners and AIF Capital are set to inject $40 million in abalone producer Oceanus.

Oceanus produces and sells Japanese abalones. It also does research and development as well as breed the

Abalone: attracting

product. The company is headquartered in Singapore, with operations in China. It is presently looking to raise $45 million to expand its production capacity and brand marketing activities.

The deal gives the company working capital to expand Oceanus’ farms and enhance downstream activities such as food processing. 

China-focused Hupomone has “agreed to consider investing” up to $15 million, said Chan Kok Pun, the firm’s head of investments, in an interview.

The investment, which is subject to due diligence, is structured in the form of a loan and warrants, which have an exercise price of S$0.15 ($0.10; €0.07) per share, he added.

Asia-focused private equity firm AIF Capital has also signed a term sheet seeking to invest $25 million in Oceanus. The investment is subject to due diligence and structured in the form of a loan and warrants with an exercise price of S$0.15 per share, as well.

AIF Capital's investment in Oceanus will be made from AIF Capital Asia III, a $435 million fund that invests in expansion, buyout and special situation opportunities in China, India and Southeast Asia. In June 2008, the fund invested $31 million in BioPlus Life Sciences, a Bangalore-based pharmaceutical company.

Hupomone will invest from its first fund, which closed on $100 million in March 2008. The fund makes growth capital investments primarily in sectors such as healthcare, environment and energy. It targets companies with operations in China and has a preferred deal size of between $10 million to $15 million, according to Chan.  

Headquartered in Beijing and Singapore, Hupomone’s past investments include Jiangxi Jinko Solar, a crystalline silicon ingot and wafer maker, and Shanghai Zesun Navigation Electron Technology, a marine navigation radar systems designer and manufacturer.