Private equity, rivals enter prelim bids for $6 billion stake in Hanon Systems -newspaper By Reuters

By Joyce Lee

SEOUL (Reuters) – Private equity firms Carlyle Group (NASDAQ:CG) and Bain Capital, auto suppliers Valeo (PA:VLOF) and Mahle were among those that entered non-binding bids to buy a stake in South Korea’s Hanon Systems worth 6.6 trillion won ($5.81 billion) as of Tuesday, South Korean media reported.

The bidders are looking into acquiring about a 70% stake of auto supplier Hanon Systems on sale by majority shareholder, local private equity firm Hahn & Company, as well as second-largest shareholder Hankook Tire & Technology Co Ltd, newspaper Korea Economic Daily reported on Tuesday citing unnamed investment banking sources.

Hanon Systems said in a regulatory filing on Wednesday that the majority shareholder is considering a stake sale with Morgan Stanley (NYSE:MS) and Evercore as advisers, but nothing has been decided.

A spokesperson for Mahle declined to comment. Spokespeople for Carlyle, Bain and Valeo did not have an immediate response.

Hanon Systems is the world’s second-largest supplier of auto thermal management systems such as heating, ventilation and air conditioning, and reported a 6.9 trillion won revenue and 315.8 billion won operating profit in 2020, according to its regulatory filing.

Shares in Hanon Systems closed down 4.1% compared with the wider market’s 0.7% rise on Tuesday.

($1 = 1,135.0600 won)