FountainVest taps into local PIPE deal
Hong Kong-based PE firm FountainVest Partners had sealed an investment deal with LK Technology, a domestic die-casting machine manufacturer, for HK$400 million ($51.3 million).
The company claims to be the world’s largest die-casting firm engaged in the design, manufacturing and sale of die-casting machines, as well as plastic-injection moulding machines & CNC machines. As part of the deal, the private equity firm will immediately buy HK$255 million ($32.7 million) of new shares and HK$145 million ($18.6 million) of perpetual subordinated convertible securities for the price at HK$2.5 ($0.32) a share. This figure represents a 9.42% discount of LK’s January 25 closing price of HK$2.76. FountainVest additionally has the right to convert these perpetual convertibles at anytime at the current price, which would be equivalent to 5.34% of the company's enlarged share capital if fully converted. The transaction will be made through FountainVest’s special investment vehicle, China Machinery.
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