Kohlberg Kravis Roberts & Co is buying $230 million of non-secured zero coupon convertible bonds in Taiwan-listed Yageo Corporation, a passive electronic component services supplier.
The bond offering, which has received approval from Taiwan financial supervisory commission on 4 June, will give the US buyout firm the equivalent of a 16.1 percent stake in the company, assuming full conversion, according to a statement.
The latest development comes in the wake of Yageo denying in mid-May, plans by private equity firms to invest in the company.
The 7-year coupons are convertible at NTD 16.15 ($0.49) a share, which represents a 11.5 percent premium to the 3-day average trading price prior to yesterday’s signing, a Yageo spokeswoman said.
The transaction, scheduled to be completed by 15 June, will make KKR the largest foreign shareholder in the company upon full coupon conversion.
Pierre Chen, chairman of Yageo said KKR’s extensive global resource will help the company enhance its competitiveness so as to benefit from the consolidation of the global passive component industry.
Founded in 1977, Yageo has production and sales facilities in Asia, Europe and Americas.
Before Yageo, KKR has invested in related Asian businesses such as software business of India’s Flextronics International last year and Singapore’s MMI Holdings, a precision engineering firm in April.