Bain Capital Partners to acquire China Fire & Security

Fri May 20, 2011 5:15pm EDT

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(Reuters) - Fire safety products maker China Fire & Security Group Inc CFSG.O said it agreed to be acquired by Amber Parent Ltd -- an affiliate of private investment firm Bain Capital Partners and Amber Mergerco Inc -- for $265.5 million.

Under the merger agreement, Beijing-based China Fire & Security Group will get $9 per share in cash representing a premium of about 23 percent on the stock's closing price on Friday.

China Fire & Security Group chairman Weigang Li and certain other members of management, who collectively have 59.14 percent of the total voting power of the company, have agreed to vote for the adoption of the merger agreement.

The merger is expected to close before November 15.

In March, the company had said it received a proposal from a private equity firm to buy all its outstanding shares in cash.

U.S.-listed Chinese companies are seeing a trend of buyouts by management and private equity funds, which aim at taking advantage of depressed valuations on U.S. stock exchanges and look to relist elsewhere.

Underwriters Bank of America NA, Citibank NA and the Hongkong and Shanghai Banking Corp Ltd have agreed to provide financing for the deal.

Shares of the company were up 17 percent at $8.56 after the bell. The stock closed at $7.33 on Friday on Nasdaq.

(Reporting by Soham Chatterjee in Bangalore; Editing by Prem Udayabhanu)

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