MSPEA backs $172m take-private bid for China auto parts player

The buyer group is willing to buy all outstanding shares for $5.45 apiece, according to a filing. This represents a slight premium to the August 31 closing price of $5.39. The deal would be financed through debt, equity from MSPEA’s fourth pan-regional fund - which closed at $1.7 billion in 2014 - and by the chairman, Hanlin Chen, rolling over his 56.4% stake in the business.

Founded in 1993, China Automotive currently offers four separate series of power steering with an annual production capacity of over 5.5 million sets of steering gears, columns and steering hoses. It operates through eight Sino-foreign joint ventures and five wholly-owned subsidiaries.

Most of the company’s business comes from Chinese auto manufacturers such as China FAW Group, Dongfeng Auto Group, BYD Auto, Beiqi Foton Motor, and Chery Automobile. However, its single biggest customer is Chrysler Group, which accounted for 11.5% of revenue last year.

Overall sales revenue came to $462.1 million in 2016, up from $443.5 the previous year. Net income dropped from $27.9 million to $22.9 million over the same period.

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• Topics
• Greater China
• Buyouts
• Industrials
• China
• manufacturing
• automobiles
• Morgan Stanley Private Equity Asia