Baring PE Asia exits Taiwan-listed Airtac

Baring Private Equity Asia (BPEA) has completed its exit from Airtac International Group, a Taiwan-founded but now mainland China-headquartered manufacturer of pneumatic components.

The private equity firm initially planned to sell 5.8 million shares – 53.5% of its total holding – but subsequently opted for a full exit in response to strong investor demand, Finance Asia reported. The sale raised NT$1.89 billion ($64 million), with the shares priced at the top end of NT$170-174 indicative range, representing a 3.9% discount to the previous closing price.

Airtac fell more than 3% to NT$175 during morning trading on Tuesday. The stock remains up nearly 13% on a one-year basis.

BPEA acquired a 25% interest in Airtac – then known as Airtac Automatic Industrial – in 2006 via its fourth fund, a $490 million vehicle that closed in 2006. The funds were used for recapitalization after the company acquired its 27 distributors in China to become a fully integrated manufacturing and distribution business. At the time, the private equity firm said the Chinese pneumatics industry, worth $475 million in 2005, would grow to $1 billion by 2009.

Airtac, which was established in Taiwan in 1988, had already set up subsidiaries in Guangdong and Ningbo (the latter now serves as its headquarters), and in 2008 it branched out into Europe with the creation of an Italian entity. Goldman Sachs took a 5% stake in the company in 2010, several months ahead of its IPO on the Taiwan bourse.

After the listing, BPEA was said to hold 14.6% of Airtac, with Goldman Sachs owning 4.3% and company management controlling 56.3%. In 2011, BPEA sold 10.8 million shares – 7.2% of the company – for NT$2.36 billion. The most recent trade was also said to be for a 7.2% interest.