UPDATE 1-Advantage Partners set to buy GST AutoLeather

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By Alison Tudor, Asia Private Equity Correspondent

HONG KONG, April 9 (Reuters) - Private equity firm Advantage Partners said on Wednesday it will buy U.S.-based GST AutoLeather, its first solo buyout outside of Japan.

The Japanese fund beat out global buyout company the Carlyle Group [CYL.UL], sources with direct knowledge of the matter said.

GST provides leather upholstery for car interiors for many of the world's major automotive original equipment manufacturers, including Toyota Motor Corp (7203.T: Quote, Profile, Research, Stock Buzz), Honda Motors Co (7267.T: Quote, Profile, Research, Stock Buzz), General Motors (GM.N: Quote, Profile, Research, Stock Buzz) and Chrysler [CBS.UL].

Advantage Partners plans to support the company's market expansion strategies, including its pursuit of the fast growing China automotive market.

"We believe GST AutoLeather has significant growth potential in the key markets in which it currently competes, as well as in newer markets such as China and the rest of Asia," said Richard Folsom, one of Advantage Partners' co-founders in a statement.

GST AutoLeather is owned by SILLC Holdings LLC, a holding company set up by private equity and venture capital firm Court Square Capital Partners, formerly known as Citigroup Venture Capital.

Citigroup Venture Capital acquired the Michigan-headquartered firm from U.S. Industries in 2000 when it bought U.S. Industries Inc's diversified businesses segment for $660 million.