China’s Goodbaby Eyes Loans After PE Talks Fail

HONG KONG (Reuters) – The private equity owner of Goodbaby Group has called off the sale of China’s largest baby stroller maker after prices came in too low, forcing the company to seek new loans to refinance its debt, sources said.

The planned sale of Pacific Alliance Group’s (PAG) 67 percent stake in Goodbaby, which makes pushchairs and other products for infants for brands including Quinny, Nike Kids and Tommee Tippee, could be worth around $300 million, Reuters reported in June.

The sale, a rare opportunity for foreign investors to take a controlling stake in a Chinese consumer product leader, attracted interest from more than 20 companies, including Permira, TPG Capital [TPG.UL], Morgan Stanley Private Equity Asia, Sweden’s EQT Partners and Affinity Equity Partners, but all talks stalled over price, said the sources familiar with the situation.

Goodbaby is now seeking $33 million in syndicated loans to refinance part of its debt, via special purpose vehicle G-Baby Holdings Ltd, according to loan market sources.

Hong Kong-based PAG’s investment in Goodbaby was China’s first Western-style leveraged buyout (LBO) deal, completed in 2006 when PAG bought a 67 percent stake in Goodbaby for $122.5 million. (Reporting by George Chen and Foster Wong; Editing by Chris Lewis)