KKR, Tiga acquire Hong Kong's The Executive Centre

The transaction size was not disclosed. When the sellers launched a process in May 2019, they were seeking a valuation of at least $750 million. This was abandoned several months later in response to protests in Hong Kong, which accounts for 30% of TEC’s EBITDA. The sellers said they would wait until conditions stabilized before returning to market.

TEC serves more than 32,000 members across 150 centers in 32 cities and 14 markets, including Greater China, Japan, South Korea, Southeast Asia, Australia, India, Sri Lanka, and the Middle East. Annual turnover exceeds $237 million. It provides premium private offices, coworking and virtual spaces, each equipped with meeting and event facilities, IT support, and concierge services.

HPEF, formerly known as Headland Capital Partners, backed TEC in 2009. CVC acquired a majority stake in the business in 2014 at a valuation of approximately $220 million, leaving HPEF with a minority position, but accounting irregularities subsequently emerged, and the business needed to be recapitalized. HPEF partially bought back CVC’s position at the same price.

HPEF ended up holding 70%, while CVC has 20%, and management owns the rest. While the two private equity investors are exiting, the management team – led by CEO Paul Salnikow – will remain invested in the business.

“As we look ahead to the market’s evolving needs, flexibility will be key in companies’ future workplace strategies. We believe The Executive Centre is well placed to capture new growth opportunities and build on its longstanding leadership position in Asia’s premium workspace segment,” said S.J. Lim, a managing director at KKR, in a statement.

KKR did not disclose which fund or strategy is investing in TEC, although Lim is listed on the firm’s website as head of Southeast Asia credit.

Tiga describes itself as a Singapore-based firm that makes long-term investments. It was established in 2017 by Raymond Zage, formerly head of Farallon Capital’s Asia business. Since July of last year, Tiga has launched five special purpose acquisition companies (SPACs). The firm did not disclose how the TEC investment would be funded.

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• Topics
• Greater China
• Buyouts
• Trade sale
• Real estate
• Support services
• Hong Kong (China)
• KKR
• CVC Capital Partners
• HPEF Capital Partners