Kohlberg Kravis Takes Over Goodpack - Analyst Blog

Kohlberg Kravis Roberts & Co. KKR, deliberating over the acquisition of Singapore-based Goodpack Ltd for the last one year, has finally confirmed the deal. IBC Capital Limited, an affiliate of Kohlberg Kravis, will take over Goodpack, the world's largest maker of intermediate bulk containers, at a price of S$1,399 million ($1.11 billion). The deal, however, is subject to Goodpack shareholders' approval and the sanction of the High Court of Singapore.

The transaction will be carried out through the share scheme, in accordance with the Singapore Code on Take-overs and Mergers and the Companies Act of Singapore. Under the share scheme, all issued ordinary shares of Goodpack will be transferred to IBC Capital.

Goodpack shareholders will be entitled to S$2.50 per share in cash, a premium of 23.2% to Goodpack's closing price on Mar 18, 2014. However, once the deal is completed, Goodpack will turn into a wholly owned subsidiary of IBC Capital and will be de-listed from the Singapore Exchange Securities Trading Limited.

Kohlberg Kravis, the New York-based global private equity fund, is always on the lookout for lucrative properties with growth potential. Some of the company's recent acquisitions define not only its expansion strategy but also its portfolio diversification plans. The takeover of Goodpack is the first takeover of a listed company from Kohlberg Kravis' $6 billion Asia fund. Notably, this is the largest private equity fund ever raised for Asia.

In recent times, private equity firms have been showing increased interest in Asian properties. According to Thomson Reuters, private equity investment in Asia has nearly tripled year to date compared to the prior-year period. Kohlberg Kravis' Asian exploration also indicates the opportunities in that continent.

Kohlberg Kravis currently carries a Zacks Rank #3 (Hold). Better-ranked investment managers include Affiliated Managers Group Inc. AMG, Cohen & Steers Inc. CNS and Woori Finance Holdings Co., Ltd. WF. All these stocks sport a Zacks Rank #1 (Strong Buy).

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