PRIVATE EQUITY | Cesar Tordesillas, Singapore

MezzAsia Capital announces Midsouth privatisation

CLSA Mezzanine Management Limited announced the successful privatisation by Zhong Nan Limited of Midsouth Holdings Limited (Midsouth) and its delisting from the Singapore Stock Exchange.

CLSA Mezzanine Management Limited arranged US$85 million in financing, along with equity committed by the deal sponsors -- the founding family and CMIA Capital Partners. Funding was used to acquire the outstanding shares of Midsouth and would also support future organic and inorganic growth of the business. The financing was structured as a combination of a senior secured loan with detachable warrants.

Besides MezzAsia Capital, the mezzanine debt fund of CLSA Capital Partners, the investor consortium also included AXA Private Equity.

Midsouth was recently named as one of Forbes' Asia's 200 "Best Under A Billion" companies. It was established in 1993 to manufacture components for air-conditioning ventilation systems, and the business has since expanded into the production of Fiber Reinforced Plastics components such as FRP vehicle parts, FRP doors and windows and other industrial FRP fittings. Zhong Nan Limited aims to expand its product offerings to include the manufacture of parts and systems for energy-related projects and supply of FRP-based products across multiple industrial sectors.

Stéphane Delatte, Managing Director of MezzAsia Capital, said he was pleased that MezzAsia had the opportunity to partner with Zhong Nan Limited and its management. "The composite materials manufactured by the company have numerous applications across industries and benefit from being a combination of lightweight, corrosion-resistant and strong," he said.

Delatte added, "With its private status, we believe that this company has greater flexibility to venture into new industries and applications without the need for ongoing approval and oversight from shareholders."

Midsouth Chief Executive Officer Gao Yanhua said: "We are pleased to receive funding support from such established institutions, which reflects their confidence in our business model and future prospects."

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