TPG, General Atlantic Seek To Exit Lenovo Via $201M Share Placement

TPG Capital and General Atlantic LLC plan to exit Lenovo through the sale of $201 million worth of shares in the personal computer company, Reuters reported citing sources. The placement will sell 282.26 million shares at between HK$5.45 and HK$5.53, according to one source familiar with the transaction.

(Reuters) – Private equity firms TPG Capital [TPG.UL] and General Atlantic are looking to exit the world’s No. 4 PC brand Lenovo (0992.HK: Quote, Profile, Research, Stock Buzz), with a $201 million share placement, sources said on Monday.

The placement would end another landmark investment in China for TPG. The San Francisco-based firm, one of the world’s largest buyout companies, originally invested in Lenovo five years ago to help the computer maker acquire IBM’s (IBM.N: Quote, Profile, Research, Stock Buzz) personal computer business.

They are offering 282.26 million shares at between HK$5.45 and HK$5.53, a discount of 0-1.43 percent from Monday’s closing share price, according to one source familiar with the deal.

Nomura was sole bookrunner on the expected total fundraising of up to HK$1.56 billion, a source said, confirming an earlier IFR report on the sale.

The final price was expected later on Monday, a source said.

TPG invested $200 million in Lenovo in 2005, with TPG unit Newbridge kicking in $50 million and General Atlantic another $100 million. In November 2007, TPG, Newbridge and GA sold $360 million worth of shares.

The Lenovo selldown is another China exit for TPG, with Newbridge exiting its Shenzhen Development Bank Co Ltd (000001.SZ: Quote, Profile, Research, Stock Buzz) stake earlier this year, in a two-part deal that earned them around $2.4 billion cash.

Newbridge acquired 299.1 million Ping An Insurance (Group) Co of China Ltd (2318.HK: Quote, Profile, Research, Stock Buzz)(601318.SS: Quote, Profile, Research, Stock Buzz) shares in May in exchange for giving a stake in Shenzhen Development Bank to the Chinese insurer.

TPG got a 4 percent stake in Ping An, the world’s second largest insurer. TPG bought a 17 percent stake in the Shenzhen bank in 2004 for $150 million.

By Shankar Ramakrishnan and Michael Smith

(Editing by Jacqueline Wong and Muralikumar Anantharaman)