Pacific Equity Partners has welcomed Kohlberg Kravis Roberts into its buyout proposal for SAI Global in Australia, local media has reported.
The two private equity firms are preparing a joint bid for the Australian compliance business after PEP’s A$1.1 billion ($1 billion; €758 million) proposal was rejected to open the offer to other potential buyers. A bid is expected by 15 July, media said.
SAI is an ASX-listed business, focusing on providing information services, risk management and compliance to companies globally. The business had recently terminated the contract of its chief executive due to his differences with the board.
KKR has been targeting Australia lately, the market being one of the key focus areas for its latest $6 billion Asia-dedicated fund.
Industry critics had questioned the firm’s ability to deploy such a large amount of capital – the most ever raised by a single private equity vehicle for the region – in Asia, but the firm had a strong deal pipeline in Australia and Japan, Asia’s most developed buyout markets, from its final close.
“We've seen activity in places like Australia, in terms of the pipeline being busy. Japan is looking a bit more active as well. It's hard to predict where that goes. But as that market opens up, there's meaningful opportunity there. So I'd say the pipeline is strong and broad-based,” Scott Nuttall, head of KKR’s global capital and asset management group, said in an earnings call in July last year.
However, in May 2014 the firm was served a disappointing blow as a A$3.1 billion offer for Australia’s Treasury Wines was rejected due to KKR allegedly breaking confidentiality agreements by contacting Treasury Wine shareholders, Private Equity International reported earlier.
The firm has had more success in Japan, though, recently closing a $1.67 billion buyout of Panasonic Healthcare – successfully completing a corporate carve-out from one of Japan’s iconic corporations.