By Kane Wu
HONG KONG, Sept 28 (Reuters) – Baring Private Equity Asia (BPEA) has tapped Goldman Sachs GS.N to be the lead adviser on a merger of Hong Kong-based business services companies Tricor and Vistra, three people with knowledge of the plan told Reuters.
BPEA completed its $2.8-billion acquisition of Tricor from private equity firm Permira in the year’s first half. It also bought a majority stake in Tricor’s peer Vistra in 2015 for an undisclosed sum.
The merged entity could be valued at $7 billion to $8 billion, if the calculations are based on the multiple of more than 20 times core earnings that BPEA paid for Tricor, said one of the sources.
BPEA’s limited partners which co-invested with the private equity fund in Vistra could choose to exit the company by selling their shares to a third party during the merger process, the source added.
The merger work is at a preliminary stage, with details yet to be worked out, said another of the sources and a separate person familiar with the situation.
It is expected to be completed by the second quarter next year, said two of the sources.
All the sources sought anonymity as the information is confidential.
BPEA and Goldman declined to comment. Tricor did not immediately respond to a request for comment.
Vistra said it was exploring a potential merger with Tricor but no decision had been made. It declined further comment, saying it was “currently in the exploration process”.
Hong Kong-based BPEA agreed this year to merge with Sweden-based private equity fund EQT in a deal worth 6.8 billion euros ($7.5 billion).
This month it said it had closed its eighth, and largest, pan-Asia fund at $11.2 billion, in the region’s largest fundraising of the year.
The firm had 27 exits from investments in the last 12 months, which generated a total of $9 billion, with overall return multiples of just under three times, its chief executive and founding partner told Reuters at the time.
(Reporting by Kane Wu; Editing by Sumeet Chatterjee and Clarence Fernandez)
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