MSPEA-backed Tianhe targets $818m Hong Kong IPO
Tianhe Chemicals Group, a Chinese specialty chemicals maker backed by Morgan Stanley Private Equity Asia (MSPEA), is seeking to raise up to $818 million through a Hong Kong IPO.
The Liaoning-based chemicals maker plans to sell 2.82 billion shares at HK$1.75-2.25 apiece, with 72.5% of the offer comprising new shares, Reuters reported.
Tianhe is China's largest manufacturer of lubricant oil additives (LOA) that perform functions including friction reduction, cleansing and heat dissipation in motor oil and other lubricants. It also supplies specialty fluorochemicals (SFC) - commonly used in waterproofing and solvents - to customers around the world.
The company was founded in 1992 in Liaoning province, where it has three manufacturing bases and a staff of more than 1,200. The chairman, Qi Wei, is responsible for product development in the company. He brought in his brother, Xuan Wei, as a shareholder and CEO, and tasked him with sourcing the capital required to keep the Tianhe R&D machine running.
Homer Sun, MSPEA's CIO, met Xuan Wei in 2009. Three years later, the private equity firm acquired a significant minority stake in Tianhe for $300 million.
Bank of America Merrill Lynch, Goldman Sachs, UBS and Morgan Stanley are the joint global coordinator on the deal.
The listing drew attention in January when J.P. Morgan gave up its coordator mandate amid an investigation by US authorities into its employment practices in China. The bank had hired Joyce Wei, daughter of Qi Wei, IFR reported.
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