Morgan Stanley PE Looking at China’s HCP Holdings

Morgan Stanley‘s Asia private equity arm is in talks to buy China’s HCP Holdings Inc., Reuters wrote Monday. The company could be valued at around $500 million, Reuters wrote. Morgan Stanley’s buyout arm aims to buy about 80% of the packaging company.

(Reuters) – Morgan Stanley’s Asia private equity arm is in talks to buy a majority stake in Chinese packaging firm HCP Holdings Inc, four sources with knowledge of the matter told Reuters, a deal that could value the company at about $500 million.

The private equity firm aimed to buy about 80 percent of HCP, one of the sources said.

UBS AG was advising the fund on the acquisition, and was seeking lenders for a $260 million loan to back the deal, said the sources, who declined to be named because the transaction was private.

HCP, Morgan Stanley and UBS declined comment.

HCP, a private producer of luxury packaging for L’Oreal SA and Shiseido, had annual sales of about $130 million, according to one of the sources.

The company was founded in Taiwan in 1961 but has most of its production facilities in mainland China.

Morgan Stanley Private Equity Asia recently took control of Korean restaurant franchiser Nolboo, a deal that local media said could be valued at about $108 million.

The private equity firm is preparing to raise a new pan-Asia fund of about $1.5 billion. (By Stephen Aldred and Sandra Tsui)