EQT AB has completed the acquisition of Hong Kong-based Baring Private Equity Asia, as the Swedish investment firm looks to capture the region’s bright prospects.
The deal combines the two firms’ Asia private equity teams to create BPEA EQT, while Baring’s real estate business will be integrated into EQT’s, according to a statement confirming a Bloomberg News report. The cash and stock transaction was worth €6.8 billion ($6.7 billion) when it was announced in March, making it the biggest takeover of a private equity firm by another in the sector.
“It’s expected that the growth of the Asian private market will accelerate at nearly double the pace of global markets through 2025,” EQT’s CEO Christian Sinding said in the statement. “As a combined firm, we offer local experience and global capabilities — underlined by shared values — that puts EQT in an even stronger position to capture the opportunity.”
The deal generates much-needed fees for advisers including Morgan Stanley, Goldman Sachs Group Inc. and JPMorgan Chase & Co. in a year when the volume of global transactions has dropped. Morgan Stanley advised EQT, while Goldman and JPMorgan advised BPEA.
EQT is financing the deal with 191.2 million new ordinary shares and $1.58 billion in cash. The shares have plunged about 35 percent since the transaction was announced, according to data compiled by Bloomberg. The firm counts about $75.82 billion in assets under management as of the end of June.
BPEA in September raised $11.2 billion in total capital commitments for its eighth private equity fund, surpassing its $8.5 billion target and becoming one of the largest funds ever raised by an Asian buyout firm. Founded in 1997 and led by Jean Eric Salata, the company has $22.1 billion of fee-generating assets under management.
