KKR to acquire Unisteel for $576m

The global private equity firm will delist the Singapore disk-drive parts manufacturer, having reportedly edged out other private equity firms such as The Carlyle Group and Bain Capital.

Kohlberg Kravis Roberts is acquiring Unisteel Technology, a Singapore-listed manufacturer of computer disk-drive parts, for S$785 million ($576 million; €365 million).

The firm’s bid proposal of S$1.95 per share was accepted by Unisteel and under the agreement KKR will acquire all the shares of the company using its $4 billion KKR Asian Fund.

Established in 1988, Unisteel Technology has manufacturing units in China, Malaysia and Singapore. It provides precision engineering and serves customers in the hard disk drive, mobile telecommunications, consumer electronics, industrial and automotive sectors.

The acquisition of the company will be completed once the necessary shareholder approvals have been obtained, the firms said in a statement. KKR has received irrevocable undertakings from shareholders with a cumulative interest of 20.54 percent in the company to vote in favour of the proposal.

The firm’s offer of S$1.95 a share is an 11 percent premium over the last traded share price on 3 June prior to a suspension in the trading of the company’s shares.

KKR wants to de-list Unisteel, though the company’s management team will stay in its place, the firms said.

Ming Lu, a partner at KKR, said: “Unisteel’s able management team and regional manufacturing capabilities provide a solid foundation for global growth.”

The acquisition of Unisteel will be KKR’s second purchase of a disk drive parts manufacturer, following its buyout of MMI Holdings for S$1 billion in July 2007.

Reuters reported sources involved with the deal as saying that KKR edged out other private equity firms including The Carlyle Group and Bain Capital for the deal.

Macquarie advised Unisteel Technologies, while Morgan Stanley and Deutsche Bank advised KKR on the deal.

KKR declined to comment.