China's Citic Capital Makes offer for New Zealand's Trilogy International -- Update

By Ben Collins Features Dow Jones Newswires

China-based investment manager Citic Capital has made an offer for New Zealand's Trilogy International Limited, which owns natural products and fragrance brands.

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In a regulatory filing, Trilogy said that Citic would buy all the outstanding shares in Trilogy for NZ$2.90 each, a 28% premium to their closing price on Thursday.

"CITIC Capital is viewed as a good owner of TIL as it moves into its next phase of growth. In particular, CITIC Capital's strong relationships in the Asian and US markets provide an opportunity to unlock the potential of these brands, and achieve faster growth globally," said Trilogy chairman Grant Baker in a regulatory filing.

In March, it was reported that Citic Capital Partners, the buyout arm of Chinese alternative investment manager Citic Capital, was nearing a $2 billion close on its third China-focused buyout fund. The amount of capital raised by private-equity firms specifically for investments in China hit the highest level in at least 10? years in 2016, according to data provider Preqin Ltd.

Appetite for China-focused private equity funds has soared as investors look to profit from the expansion in China's middle class and the associated rise in consumer spending.

Among Citic's previous investments was the acquisition alongside Carlyle Group of a controlling stake ?in ?McDonald's operations in China and Hong Kong in January this year.

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Citic's offer for Trilogy is subject to court approval in New Zealand, as well as approval by the country's Overseas Investment Office.

Citic Capital Holdings Limited has US$22 billion of assets under management and was founded in 2002. The firm has over 130 companies in its portfolios.

Write to Ben Collins at ben.collins@wsj.com

WELLINGTON, New Zealand--China-based investment manager Citic Capital has made an offer for New Zealand's Trilogy International Limited, which owns natural products and fragrance brands.

In a regulatory filing, Trilogy said that Citic would buy all the outstanding shares in Trilogy for NZ$2.90 (US$2.03) each, a 28% premium to their closing price on Thursday. The deal would value Trilogy at around NZ$250 million (US$175 million).

"CITIC Capital is viewed as a good owner of TIL as it moves into its next phase of growth. In particular, CITIC Capital's strong relationships in the Asian and US markets provide an opportunity to unlock the potential of these brands, and achieve faster growth globally," Trilogy Chairman Grant Baker said in a regulatory filing.

In March, it was reported that Citic Capital Partners, the buyout arm of Chinese alternative investment manager Citic Capital, was nearing a $2 billion close on its third China-focused buyout fund. The amount of capital raised by private-equity firms specifically for investments in China hit the highest level in at least 10 years in 2016, according to data provider Preqin Ltd.

Appetite for China-focused private-equity funds has soared as investors look to profit from the expansion in China's middle class and the associated rise in consumer spending.

Among Citic's previous investments was the acquisition, alongside Carlyle Group, of a controlling stake in McDonald's operations in China and Hong Kong in January this year.

Citic's offer for Trilogy is subject to shareholder and court approval in New Zealand, as well as approval by the country's Overseas Investment Office. A shareholder meeting is scheduled for March next year. New Zealand-based venture capital firm The Business Bakery, which owns 31.2% of Trilogy's shares, has said it is in favor of the deal.

Citic Capital Holdings Limited has US$22 billion of assets under management and was founded in 2002. The firm has over 130 companies in its portfolios.

Hanxi Zhao, a senior managing director of Citic Capital, said the fund was making the investment to boost trilogy's global growth, as it "owns very strong brands in its respective beauty and lifestyle sectors, including Trilogy, Goodness, Lanocreme and ECOYA.

"Its flagship brand, Trilogy, is a leading premium brand in the natural skincare space and has been highly recognised by skincare experts, celebrities and consumers all over the world," she said, adding that if the offer is successful, Trilogy's head office would remain in Auckland.

Write to Ben Collins at ben.collins@wsj.com

(END) Dow Jones Newswires

December 14, 2017 17:48 ET (22:48 GMT)