| HONG KONG, April 22
HONG KONG, April 22 U.S. private equity firm TPG
Capital is putting China's UniTrust Finance & Leasing Corp up
for sale, seeking $800 million, and has hired Morgan Stanley and
UBS to handle the deal, people with knowledge of the matter told
Bank and non-bank financial institutions from Europe, Japan
and Australia are expected to bid for Shanghai-based UniTrust,
which provides equipment leasing finance for small and
medium-sized companies in the construction, medical, education
and technology industries, the sources said.
Suitors are likely to be attracted by the ability to lend to
China's SMEs, which struggle to get loans from China's big
banks. China's 4.3 million SMEs account for 60 percent of
China's GDP and 75 percent of new jobs created in the country.
TPG acquired a controlling stake in the business as part of
a $275 million investment in Japan's Nissin Leasing in 2008.
A successful exit from UniTrust would boost TPG's
fund raising efforts in Asia. The buyout fund has raised less
than $2 billion of its $5 billion target since its launch in
late 2011, while rival KKR & Co has raised $6 billion
since its launch in January 2012.
UniTrust's main competitors include KKR-backed Far East
Horizon. Far East, which has a market value of $2.2
billion, trades at a 12-month forward price-to-earnings multiple
of 7.2, according to Thomson Reuters data.
Morgan Stanley and UBS are expected to kick
off a formal sale in the next two weeks.
Sources declined to be identified as the sale process was
private. TPG, Morgan Stanley and UBS declined comment. UniTrust
did not reply to emails and phone calls seeking comment.
UniTrust earlier this year took out a 3 billion yuan loan
($486 million) from Chinese banks to refinance outstanding debt,
according to Basis Point, a Thomson Reuters publication.