Partners Group buys China-focused elevator components maker
Partners Group has agreed to buy a controlling stake in Suzhou Savera Elevator Riding System, a Spanish elevator components manufacturer that now draws most of its business from China, for an enterprise valuation of more than $450 million.
The private markets investor will take an approximately 75% stake in the business, according to a source familiar with the situation, primarily from the Savera's founding family. The balance will be held by the family and their long-term Chinese business partner Liansheng Cai, who is also vice chairman of the company.
Savera was founded in Spain in 1967 and has become a leading global player in its industry, supplying the likes of Hitachi, Kone, Schindler, Mitsubishi, Otis, ThyssenKrupp, Fujitec and Toshiba. The company opened a factory in China in 1999 and has since developed its local business through a combination of acquisitions and joint ventures.
Savera moved its headquarters to Shanghai in 2012 and has joint ventures in Suzhou, Tianjin, Guangzhou and Jiashan as well as additional sites in Chongqing and Chengdu. China accounts for approximately 85% of revenues. The company has 11 facilities globally, with a presence in Germany, India and Spain, as well as China.
"The Savera acquisition is a perfect fit with our relative value investment strategy of seeking out mid-market leaders and working with them to expand their business further. Savera is ideally positioned to benefit from the continued trend of urbanization in China and other developing countries, which provide robust support to the overall real estate construction sector," Christoph Rubeli, co-CEO and head of private equity directs at Partners Group, said in a statement.
The firm has devised a value creation plan that involve expanding Savera's geographical coverage, identifying acquisition targets and operating partners, increasing R&D activity in China, and optimizing organizational structure, corporate governance and business operations.
The transaction is the largest private equity buyout seen in China so far this year and Partners Group's first control deal in the country - although it did acquire Trimco International, a garment label manufacturer with a significant China business, in 2012. Partners Group followed up last year with its second buyout Asia, taking a majority stake in Indian IT services provider CSS Corp.
The acquisition of Savera is expected to close by the end of 2014, subject to certain closing conditions and government approvals. Business Development Asia acted as exclusive financial advisor to Savera.
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