Silver Lake eyes Asia tech investments
TAIPEI (Reuters) - Private equity fund Silver Lake is in talks with technology companies in China, Taiwan, South Korea and Japan as it looks for firms with strong growth potential during the global financial turmoil, an executive said on Monday.
Among the 100 large technology firms in Asia, the U.S.-based private equity firm has been in talks with more than a dozen of them about potential investments or stake purchases.
Silver Lake, which specializes in technology investments and manages a total of $16 billion in its three funds, launched its Asian operation this year.
"I think this is an environment where the best tech companies are going to get stronger. I do think large Asian companies are more ready for global expansion and new strategy," said Kenneth Y. Hao, a managing director of Silver Lake.
"Because of our fundraising approach, we can continue to look for companies that fit our criteria even in the current financial environment," Hao told Reuters in an interview on the sidelines of a conference.
Silver Lake would use part of the $9.3 billion fund it raised last year to buy into Asia's tech companies, he said.
He declined to identify the companies Silver Lake was talking to, but said both healthy and distressed firms were potential targets.
Silver Lake favored big tech firms -- with annual revenue of US$500 million -- including those in Taiwan's foundry, flat-panel and semiconductor sectors, said Hao.
Taiwan is a tech powerhouse with its companies producing about 80 percent of the world's computer motherboards and 40 percent of flat panel displays.
Taiwan Semiconductor Manufacturing Co and United Microelectronics Corp are the world's top two contract chipmakers, or foundry service providers.
Taiwan's AU Optronics, the world's No.3 flat-panel maker, competes with bigger South Korean rivals.
Silver Lake joined rivals such as Blackstone Group, Texas Pacific Group and the Carlyle Group in Asia, but private equity activity has slowed as the U.S. financial meltdown spreads.
"We have been deeply affected by the global financial crisis. We are currently not in fund raising," Hao said.
Silver Lake's portfolio of investments included Avago Technologies, Intelsat Ltd and Avaya, according to the company website.
"Our investors give us 10 years or more. We don't feel any pressure from our investors," said Hao. "I have strong belief tech is the most important industry of an economy."
