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| NewQuest buys Bank of America Merrill Lynch's PE portfolio |
| BS Reporter / Mumbai Apr 19, 2011, 00:16 IST |
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Bank of America Merrill Lynch has sold out its Asia non-real estate private-equity assets to NewQuest Capital Partners, the Hong Kong-based PE firm set up by four private equity firms, including Paul Capital. The Bank of America Merrill Lynch Asia private equity team will continue to manage the portfolio as part of NewQuest Capital Partners. The financial terms of the deal are not disclosed.
The acquired portfolio consists of over 20 growth-equity and buyout interests primarily in Chinese and Indian companies focused on domestic economies. Merrill Lynch Global Private Equity’s current India portfolio includes DRS Warehousing Pvt Ltd, Pipavav Shipyard Ltd, and Vestas RRB India Ltd. It has also invested in Salarpuria Group’s five-star hotel project SPV, but real estate deals are not part of this spin-off.
Last year, HSBC Holdings’s Asian private-equity arm, with about $2.4 billion under control, was bought out by its managers and renamed Headland Capital Partners, although HSBC retains a 19.9 per cent stake.
Newquest formed NewQuest Asia Fund I, LP, a fund focused on investment opportunities in Asia, to buy out the assets.
The NewQuest Capital Partners’ private-equity team will be led by Darren Massara, as managing partner, and Amit Gupta, Bonnie Lo, and Min Lin as partners. All of them were formerly part of Bank of America Merrill Lynch’s Asia private-equity team.
“If you look at private equity strategy in Asia, it’s a very crowded market, with buyout firms, local and international private equity firms, hedge funds and family offices all buying $25 million-$75 million minority or growth investments,” said Massara. “We’re focusing on secondary positions, because it’s an undertapped market—in Europe, 50 per centof exits are through secondary sales, in the US, in the low 30s, and in Asia, just around 10 per cent,” Massara added.
Newquest, which has $400 million under management, is backed by a syndicate of private- equity fund managers including HarbourVest Global Private Equity Ltd, LGT Capital Partners and Axiom Asia, apart from Paul Capital.
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