June 7, 2007 / 8:25 AM / 12 years ago

KKR seeks more Taiwan investments after Yageo deal

TAIPEI (Reuters) - KKR, one of world’s largest private equity firms, said on Thursday it is aiming to make more investments in Taiwan over the next six months, following its first ever investment in the increasingly popular market.

Kohlberg Kravis Roberts & Co. KKR.UL announced its first deal in Taiwan late on Tuesday, saying it would buy US$230 million of Yageo Corp.’s (2327.TW) convertible bonds that could give it a 16.1 percent stake in the electronics parts maker.

“We hope to make more investments in Taiwan and China, that’s for sure,” Julian Juul Wolhardt, principal of KKR Asia Ltd., told Reuters. KKR joins other major private equity firms, including Newbridge (TPG) NB.UL, Carlyle CYL.UL and MBK Partners in the Taiwan market.

Wolhardt said KKR was looking at investments in the technology and banking sectors, without providing any details.

KKR’s Yageo investment will see it buy almost all the bonds issued by the Taiwan company at a conversion price of T$16.15 per share, representing an 11.5 percent premium to the average share price of the three days before the deal was announced.

KKR would become the single largest shareholder in the components maker if it chooses to fully convert the seven-year zero-coupon bonds when they come due.

Yageo's shares rose 1.67 percent to T$15.20 on Thursday, outpacing a 0.49 percent gain in the benchmark index .TWII.

The Commercial Times on Wednesday quoted an unnamed KKR executive saying he hoped the investment would help Yageo become the world’s No.1 player in the field, exceeding bigger Japanese rivals such as TDK Corp. (6762.T) and Murata Manufacturing Co. Ltd. 6981.OS.

Goldman Sachs (GS.N) was the financial adviser for Yageo, the paper said.

The bond deal is set to be concluded on June 15.

(Additional reporting by Ricci Chan)

US$1=T$33.02

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