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CVC Capital Offers $1.1 B Buyout of Nirvana, Asia's Top Funeral Parlor

CVC Capital Offers $1.1 B Buyout of Nirvana, Asia's Top Funeral Parlor

Financial Times. “The Malaysian company has rolled out an unusual business model across Southeast Asia: pre-selling burial plots and funeral services to the living.” “We don’t use conventional methods to sell our products,” says Kong Yew Foong, an executive director and son of founder Tan Sri Dato’ Kong Hon Kong. “We don’t wait for the customers to come in.” Nirvana Asia, which calls itself the “largest integrated death care service provider in Asia,” offers premium tombstones, columbarium facilities, funeral services, and burial plots in six countries across Asia, including Malaysia, Singapore and Indonesia, mostly to ethnic Chinese Buddhists and Taoists. The company employs over 700 staff across the region. Kuala Lumpur, Malaysia-based Nirvana went public on the Hong Kong stock exchange in December 2014, raising HK$1.9 billion ($250 million) in a so-called “death care” IPO, following in the footsteps of its peer Fu Shou Yuan, a luxury Chinese cemetery and funeral chain, that raised about the same amount a year earlier, but has been trading recently at much higher valuation multiples than Nirvana. Nirvana’s largest, most-lucrative, and fastest-growing business is in so-called “niches,” or reserved spots for relatives to leave the urns of the deceased. The company also has significant real-estate holdings in Malaysia. Overall, the company has a land bank of 3 million sqm, most of it in Malaysia, which reportedly generates more than 80% of revenue. The company had revenues of $149 million in 2015. Nirvana’s cemeteries command “excellent Feng Shui” alongside breathtaking landscaping, the company says. Nirvana began operations at its Singapore columbarium facility in 2009 after its acquisition and renovation. It is the only commercial columbarium facility in Singapore. The company uses high quality materials in the construction of niches and currently has plans to expand its Singapore facilities to increase the capacity by 24,640 double niches. Tan Sri Dato’ Kong, who founded the company in Malaysia in 1990 and serves as chief executive, owns 43% of the company, which employs his five children. Born to a rubber tapper in Malaysia in 1954, he was prompted to found Nirvana by the death of his father-in-law in 1985, at a time when there were no private cemeteries or premium funeral services in Malaysia. CVC is advised by JP Morgan and Clifford Chance. Nirvana is advised by UBS and Sullivan and Cromwell. Fully committed debt financing is being provided by CIMB. CVC Capital Partners, headquartered in Luxembourg, is one of the world’s leading private equity and investment advisory firms. Founded originally in 1981 as the European arm of Citicorp Venture Capital, the CVC Group today employs some 300 people throughout Europe, Asia and the US. The firm was spun out from Citicorp in 1993, as an independent private equity firm. The CVC team’s local knowledge and extensive contacts underpin a proven track record of over 30 years of investment success. CVC manages capital on behalf of over 300 institutional, governmental and private investors worldwide, having secured commitments of more than US$71 billion in private equity, credit and growth funds. In late May, CVC Capital acquired Italian gaming and payments operator Sisal Group SpA, from Apax Partners, Permira and Clessidra for €1 billion. [caption id="attachment_431698" align="aligncenter" width="1024"]Bernie Ecclestone, CEO of Formula One Group, with Donald Mackenzie, Co-Founder and Co-Chairman of CVC Capital Partners (L-R) Bernie Ecclestone, CEO of Formula One Group, with Donald Mackenzie, Co-Founder and Co-Chairman of CVC Capital Partners.[/caption] A few weeks earlier, CVC Capital acquired a majority stake in German gaming company Tipico for close to €1.5 billion ($1.68 billion). In December 2014, CVC acquired Sky Betting and Gaming for £800 million, consisting of five core brands Sky Bet (sports betting), Sky Vegas (online in-browser casino), Sky Casino (premium online casino, live table games), Sky Poker (online poker) and Sky Bingo (online bingo). CVC also made previous investments in British sports betting operator William Hill (2002 IPO exit, at 314% ROI) and the IG Group, a digital trading and betting platform. CVC Capital also gained control of the Formula One Group in 2006 in a leveraged buyout funded with two loans – $965.6 million from its Investment Fund IV and $1.1 billion from RBS, turning the firm into the biggest winner in the history of the Formula One grand prix.]]>

AirAsia Eying $1B Sale of Leasing Co, Amid BOC Aviation IPO, $CIT Aero Sale

AirAsia Eying $1B Sale of Leasing Co, Amid BOC Aviation IPO, $CIT Aero Sale

Reuters reported on Aug. 4.


Malaysian low-cost airline AirAsia Berhad (MYX: 5099) reportedly received an offer valued at $1 billion for its aircraft-leasing business, according to CEO Tony Fernandes. AirAsia plans to divest its aircraft leasing subsidiary Asia Aviation Capital Ltd, Fernandes told Bloomberg TV during an interview at the end of May. The move comes a day after CIT Group Inc. (NYSE: CIT), a leading US provider of commercial lending and leasing services, was said to be speeding up the sale process of its own CIT Aerospace global commercial air business, to advance the company’s strategic initiatives first announced by its former chairman and CEO John A. Thain, upon his retirement on October 21, 2015. Moreover, BOC Aviation, an arm of Bank of China, the country’s fourth-largest lender by assets, launched an initial public offering in Hong Kong for its aircraft leasing business, targeting HK$8.7 billion ($1.13 billion) from the sale of both new and existing shares, FinanceAsia reported. BOC International and Goldman Sachs are the joint sponsors of the IPO. Similar to other recent billion-dollar IPOs in Hong Kong, BOC Aviation has lined up local and foreign cornerstone investors to subscribe for $583 million, or 52% of the deal before the order book was opened to public institutional and retail investors BOC Aviation will be the second aircraft leasing company listed in Asia after China Aircraft Leasing Group (CALC) floated its shares in Hong Kong two years ago, says FinanceAsia. BOC Aviation’s fleet is nearly four times bigger than CALC’s though, at almost 230 planes, while its expected market capitalization is over six times greater. BOC Aviation is a leading global aircraft operating leasing company and the largest aircraft operating leasing company headquartered in Asia, as measured by the value of owned aircraft. BOC Aviation has delivered 22 years of unbroken profitability, with a portfolio of owned aircraft has an average age of less than four years, weighted by net book value, making it one of the youngest in the aircraft operating lease industry. With shares scheduled to begin trading on June 1, BOC Aviation looks set to steal a march on rivals CDB Leasing and Minsheng Financial Leasing, which are both also preparing to list in Hong Kong later this year, FinanceAsia added. As airlines serving Asia Pacific are attempting to expand their fleets, they’re finding that the leasing business can be more lucrative than operating an airline, which has prompted conglomerates led by Hong Kong billionaires Li Ka-shing and Cheng Yu-tung to enter the industry, says Bloomberg. CIT Aerospace owns, finances and manages a fleet of more than 350 commercial aircraft serving approximately 100 customers in 50 countries. CIT Aerospace offers an array of industry-leading services, supported by our fleet of Airbus, Boeing, Embraer and Bombardier aircraft. CIT Aerospace has seven aircraft leasing, advising and syndication offices in Dublin, Ireland; Ft. Lauderdale, Fla.; Los Angeles, Calif.; New York, N.Y.; Seattle, Wash.; Singapore; and Toulouse, France. More than a dozen entities were invited to submit first-round bids for CIT Aerospace by next month. Given the growing Asian demand and shifting balance of the global aviation industry to Asia, a strong line-up of Chinese and Japanese suitors are expected to bid for the unit, including China’s HNA Group, Industrial and Commercial Bank of China’s ICBC Leasing, and Japan’s Orix Corp. AirAsia is engaged in the provision of air transportation services. The company’s segments include Malaysia, Thailand, Indonesia, Philippines, India and Japan. AirAsia was founded in 1993 by DRB-Hicom, a government-owned conglomerate, and began operations in 1996. In December 2001, the heavily-indebted airline was acquired by former Time Warner executive Tony Fernandes, though his company Tune Air Sdn Bhd, for a token sum of one ringgit (about USD 0.26 at the time), and the assumption of USD 11 million (MYR 40 million) in debts. In 2001 Fernandes started with 2 old aircraft, and turned the company around, generating a profit in 2002 and launching new routes from its hub in Kuala Lumpur, undercutting former monopoly operator Malaysia Airlines with promotional fares as low as MYR 1 (US$0.27). Born in the aftermath of 9/11 and coming through the global financial crisis, AirAsia has faced some of the most turbulent times in the airline industry. In 2003, AirAsia opened a second hub at Senai International Airport in Johor Bahru near Singapore and launched its first international flight to Bangkok. It subsequently started its Thai AirAsia affiliate, and began flights to Singapore and Indonesia, Macau, mainland China (Xiamen), the Philippines (Manila), Vietnam, Cambodia, Brunei and Myanmar, the latter by Thai AirAsia. the cairline kept growing by continuously adding new routes and aircraft. The company’s subsidiaries include AirAsia Investment Ltd, engaged in investment holdings; AirAsia Go Holiday Sdn Bhd, engaged in the tour operating business; AirAsia Corporate Services Ltd, which facilitates business transactions for AirAsia Group with non-resident goods and service providers; Ground Team Red Sdn Bhd, which provides special purpose vehicles for financing arrangements required by AirAsia; AirAsia (Mauritius) Ltd, which provides aircraft leasing facilities to Thai AirAsia Co. Ltd, and AirAsia Aviation Capital Ltd, which provides aircraft leasing services, among others. AirAsia is headquartered near Kuala Lumpur, Malaysia.]]>

1MDB'S $2.3B Edra Sale to CGN,  Statoil's $2.25B Shah Deniz Sale to Petronas, Top Malaysia's 2015 Deals

1MDB'S $2.3B Edra Sale to CGN, Statoil's $2.25B Shah Deniz Sale to Petronas, Top Malaysia's 2015 Deals

1MDB – EDRA – CGN Announced in November 2015, the Edra acquisition is expected to be completed in February 2016. Through a share sale and purchase agreement, CGN is acquiring 100% of 1MDB’s energy assets, which consist of 13 power plants across five countries from Malaysia to Egypt and Bangladesh. The Edra deal came about after a bidding process triggered by 1MDB’s desperate struggle to dig itself out of a heavy debt load and political scandal. The 1MDB affair has put Malaysian Prime Minister Najib Razak in the spotlight, embroiling his government in its biggest political controversy in years. AZERBAIJAN’S SHAH DENIZ OFFSHORE GAS FIELD Norway-based Statoil sold its stake in Azerbaijan’s Shah Deniz natural gas field to Petronas in April 2015. As a result, Petronas officially owns a 15.5% interest in the Shah Deniz production-sharing agreement in the Caspian Sea, a 12.4% stake in Azerbaijan Gas Supply Co and a 15.5% share in the South Caucasus Pipeline (SCP) Co. The Shah Deniz gas field is the largest natural gas field in Azerbaijan. It is situated in the South Caspian Sea, off the coast of Azerbaijan, approximately 70 kilometres southeast of Baku, at a depth of 600 metres. The Shah Deniz offshore field’s reserves are estimated at 1.2 trillion cubic meters of gas. The field is operated by BP which has a share of 28.8%. Other partners include TPAO (19%), SOCAR (16.7%), Petronas (15.5%), LUKoil (10%) and NIOC (10%). PETRONAS Headquartered in Petronas Twin Towers, Southeast Asia’s tallest building complex, in Kuala Lumpur, Malaysia, state-owned Petroliam Nasional Berhad (Petronas) is the single largest source of Malaysian government revenue and national export earnings. Earnings for the company have taken a pounding over the past year as global oil prices have tumbled. Its declining fortunes will add to concerns over the economic prospects of a country heavily dependent on oil exports. Malaysia’s economic growth is slowing and the ringgit currency is one of the worst performing in Asia this year due in part to concerns over the economic outlook. As a holding company for Malaysia’s integrated oil and natural gas concerns, Petronas’ subsidiaries operate in more than 20 countries, primarily in Asia and Africa. The company has reserves of more than 27.1 billion barrels of oil equivalent (boe) and produces about 1 million boe per day. It is a major producer of liquefied petroleum gas (LPG) and liquefied natural gas (LNG). Petronas operates more than 900 domestic gas stations. It also sells aviation fuels, kerosene, and lubricants and is a major petrochemical producer.]]>