Baring Asia completes $980m take-private of Taiwan's Ginko

It is the largest transaction of its type in Taiwan’s consumer sector and a relatively rare instance of a private equity firm delisting a company from the Taipei Exchange. Take-privates historically have proved challenging in Taiwan, with regulators either blocking deals or withholding approval until the financial sponsor gave up.

KKR made a breakthrough in 2018 with the NTD 47.8bn acquisition of LCY Chemical Corp – seven years after a deal involving electronic components manufacturer Yageo Corporation was controversially blocked despite a majority of minority shareholders accepting the offer.

Ginko announced last November that its board had unanimously approved an offer from BPEA of NTD 280 per share, which represented a 43.8% premium to the volume-weighted average price for the preceding 30 days. The board said that privatisation would allow a more flexible development strategy characterised by long-term value enhancement and international expansion.

Founded in 1985, Ginko claims to be China’s leading contact lens producer with a portfolio of clear and coloured branded products across multiple price points. The company has manufacturing facilities on both sides of the Taiwan Strait and an omnichannel distribution network with a particular emphasis on e-commerce.

BPEA said that Ginko sits at the intersection of two of its core sectors, healthcare and consumer. It believes the company is well-positioned to benefit from long-term sector tailwinds, including rising adoption of contact lenses in mainland China and increased demand for coloured contact lenses for aesthetic purposes.

“Ginko is an exceptional player in its sector and we believe it is very well-placed to take advantage of its strong position to continue its impressive growth trajectory to date,” said Alex Lee, a managing director at BPEA, in a statement.

The transaction will be supported by a sustainability-linked financing package, with an interest rate stepdown accessible on the achievement of certain environmental and governance milestones. These facilities have become increasingly popular over the past year, at the transaction level and at the fund level. BPEA secured a USD 3.2bn fund level facility last year.

Ginko generated NTD 8.9bn in revenue for the 12 months ended December 2021, up from NTD 7.3bn a year earlier. Over the same period, net profit fell from NTD 997.2m to NTD 956.4m.

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• Topics
• Greater China
• Consumer
• Industrials
• Buyouts
• Taiwan (China)
• Baring Private Equity Asia