Forebright supports take-private of China's Jinpan International
Forebright Capital, a PE firm formed last year though a spin-out from China Everbright International, is supporting a $73.9 million take-private bid for US-listed Jinpan International, led by the company’s chairman.
Zhiyuan Li, who is president and CEO as well as chairman, is offering to pay $4.50 per share for all outstanding American Depository Shares (ADS) in the electronic transformers manufacturer. The bid represents a 24.3% premium to the September 14 closing price, according to a regulatory filing. Jinpan's stock has gained 6.9% since the offer was announced.
The consortium plans to finance the deal through a combination of debt and equity capital. As of April 2015, Li held a 24.3% stake in the company.
Forebright is participating through Forebright Smart Connection Technology, a subsidiary of Forebright New Opportunities Fund. A filing for the vehicle was made in August 2014 with a target of $600 million. Another filing in July of this year indicated that $236.8 million had been committed by 19 LPs. This does not necessarily represent all the capital raised.
Jinpan designs and manufactures medium voltage power distribution products, including cast resin dry type transformers, reactors, switchgears, and substations. It supplies a wide range of clients in the industrial and infrastructure sectors, with a particularly strong line in green energy and smart grid supply chains.
The company reported net sales of RMB1.47 billion ($230.8 million) in 2014, up from RMB1.39 billion the previous year. Net income fell from RMB102.6 million to RMB94.8 million over the same period.
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