GO Scale Capital, a fund sponsored by GSR Ventures and Oak Investment Partners, said it working with Bank of China to finance its buy of Lumileds. Philips announced the sale of Lumileds to GO Scale Capital, which is buying 80.1 percent, in March. The deal, reportedly valued at $3.3 billion, includes $1.93 billion in debt. Lumileds is Philips combined LED components and Automotive lighting business.
HONG KONG, May 28, 2015 /PRNewswire/ —
GO Scale Capital, an independent investment fund sponsored by GSR Ventures and Oak Investment Partners, announced today that it is working with Bank of China, with the support of Philips, to finance the acquisition of an 80.1% interest in Philips’ combined LED components and Automotive lighting business. This business will continue under the name Lumileds. The acquisition will be financed with cash and equity. The USD 1.93 billion debt facilities will include a term loan with USD and EUR tranches, and a revolving credit facility.
“With the support of Philips, we are happy to partner with Bank of China as the Mandated Lead Arranger and Sole Bookrunner of debt financing for the Lumileds acquisition. We explored numerous financing options with international financial institutions and found that Bank of China offered the most tailored terms plus efficient and strong support that would give the company the benefit of both operational flexibility and cost savings,” said Sonny Wu, co-founder and managing director of GSR Ventures and Chairman of GO Scale Capital. “This partnership increases value to shareholders as the financing will enable the company to focus on investments and growth. We look forward to expanding our partnership with Bank of China who has demonstrated unparalleled execution speed and a very high degree of international market sophistication throughout this transaction.”
The acquisition of the majority interest in Lumileds is expected to be completed in the third quarter of 2015, subject to closing conditions, including customary regulatory approvals.
“The Lumileds debt financing represents a landmark transaction. As the only Chinese bank with continuous operating history for over a century, Bank of China has an extensive global service network, a diversified business platform, and international business expertise to provide leveraged buy-out financing in support of private equity clients’ acquisitions globally,” said Li Mang, Deputy General Manager of Corporate Banking, Bank of China. “We believe in the market potential of Lumileds and the ability of its leadership and sponsors to enhance its business activities around the world,” he added.
The landmark debt financing has been made possible due to Lumileds’ strong credit story, which is underpinned by its market leading position and business performance, and market recognition of the strategic and operating value that GO Scale Capital will deliver to help Lumileds achieve transformational growth in the LED lighting industry in China and the rest of the world.
Lumileds is a leading supplier of lighting components to the general illumination, automotive and consumer electronics markets with operations in more than 30 countries and has approximately 8,300 employees worldwide. In 2014, it generated sales of approximatelyUSD 2 billion and a double-digit EBITA margin.
About GO Scale Capital
A new independent investment fund sponsored by GSR Ventures and Oak Investment Partners, GO Scale Capital is a growth stage fund under the GSR Capital family of funds, with offices in Beijing, Hong Kong and Silicon Valley. The fund’s team brings together years of cross border operating experience and successful co-investment history in proven and cutting edge technologies. The fund’s goal is to scale up its investments in China for global markets.
SOURCE GO Scale Capital