(Corrects paragraph 1 to read "largest gross profit" instead of
"most profitable exit", corrects multiple in paragraph 2 to five
times from four and gives X.D. Yang's full title in final
* Carlyle invested $800 mln in Chinese insurer CPIC in
* CPIC selldown marks Carlyle's most profitable ever exit
* Shares offered at HK$30 to HK$30.30 range
By Fiona Lau and Elzio Barreto
HONG KONG, Jan 7 Carlyle Group plans to
sell its remaining stake in China's third-largest insurer in a
deal valued at up to $790 million, marking the U.S. private
equity fund's largest gross profit ever from an investment.
After several selldowns of its stake in the last two years,
Carlyle will net more than $4 billion profit on the deal, or
five times the cash it paid. In private equity terms, a profit
of two times cash paid for a gain of several hundred million
dollars is considered a successful exit.
The Washington, D.C.-based firm is offering 203 million Hong
Kong-traded shares of China Pacific Insurance (Group) Co Ltd
(CPIC) in a range of HK$30 to HK$30.30 per share,
according to a term sheet of the deal seen by Reuters.
Carlyle invested about $800 million in CPIC between 2005 and
2007 for a 17 percent stake. The firm began to sell its stake
late in 2010, exiting portions of its investment in various
chunks, culminating in the current term sheet.
Strong demand for insurance products in China coupled with a
bull market led to the surge in CPIC's shares.
The firm raised a total of $5.1 billion through its CPIC
sales, including the most recent offering. That would put
Carlyle's profit from the CPIC deal at $4.3 billion, according
to Reuters calculations.
Carlyle's exit of U.S. healthcare company HCR Manorcare is
listed at $6.1 billion, but that deal was financed by loans and
the gross profit was smaller. Carlyle paid all cash for the CPIC
The sale comes after CPIC's shares surged nearly 40 percent
over the past year, reaching a 52-week high last Thursday.
Goldman Sachs and UBS were hired as joint
bookrunners for the selldown.
Carlyle's CPIC investment was led by X.D. Yang, Hong
Kong-based managing director and co-head of Carlyle Asia
(Reporting by Fiona Lau of IFR and Elzio Barreto; Editing by
Michael Flaherty and Ryan Woo)