Hua Capital, CITIC, Goldstone to buy OmniVision for $1.9b
A Chinese PE consortium comprising Hua Capital, CITIC Capital and Goldstone Investment have agreed to buy OmniVision Technologies, a US-listed chip maker for smart phones and tablet cameras, for $1.9 billion in cash.
According to a filing, the consortium will acquire 63 million shares at $29.75 apiece, which represents a 12% premium to the closing price on April 29, the last trading day before the deal was announced. The agreement has been approved by OmniVision's board of directors. Once the deal is completed, the company will be delisted from NASDAQ, while Shaw Hong will remain as CEO.
Founded in 1995, California-based OmniVision manufactures sensors, chips and other components for cameras used in smart-phones and other devices. Its revenue increased by 3.3% to $1.5 billion in the 2014 financial year, while net income rose to $95 million in 2014 from $43 million in 2013. The company's largest customers are Taiwan-based Foxconn Technology Group and Korean manufacturer Cowell Electronics, which accounted for about 13.8% and 12.5%, respectively, of total revenue last year.
"With our new partners' knowledge and insight and the added flexibility that we will have as a private company, OmniVision will be able to focus on reaching the next level of growth, which will benefit ouremployees, customers and business partners," Hong said in the filing.
The transaction, which is expected to close early next year, requires shareholder and regulatory approval. OmniVision said it will divest certain assets in Taiwan, including interests in a joint venture, in order to get the green light from local regulators.
Beijing-based Hua Capital was founded by an investment team from Tsinghua Holdings and China Fortune-Tech Capital, primarily focuses on investments in the semiconductor industry. Earlier this year it participated in a consortium led by SummitView Capital that wants to privatize NASDAQ-listed semiconductor manufacturer Integrated Silicon Solution.
Established in 2002, CITIC Capital manages over $4.6 billion in assets. It is owned by Chinese conglomerate CITIC Group, Tencent Holdings, China Investment Corporation, and Qatar Holding. It has previously backed take-private deals for AsiaInfo-Linkage and Focus Media.
Goldstone was incorporated as a wholly-owned subsidiary of CITIC Securities in 2007 with a remit to make direct investments on behalf of the group.
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