News you can profit from: Sweden-based investment firm EQT eyes Southeast Asia after US$6.7 billion merger with Baring Private Equity Asia
The following news, which investors can profit from, is sourced, excerpted, and edited from the South China Morning Post.
The just completed merger forms the world's third-largest private equity firm with active ownership strategies.
The combined entity will continue Baring Private Equity Asia's focus on tech and real estate, while eyeing growth companies in Southeast Asia.
The private equity (PE) entity formed by the just completed US$6.7 billion merger of Sweden-based PE firm EQT and Hong Kong-based Baring Private Equity Asia (BPEA) is betting on Asia to help it challenge global giants KKR and Blackstone.
The combined entity, to be known as BPEA EQT, will stick to Baring's focus on investing in the technology and real estate sectors in the region, with a particular eye on growth companies in Southeast Asia, said BPEA EQT partner Kosmo Kalliarekos.
BPEA EQT is now the world's third largest PE firm with active ownership strategies — in which a fund is usually engaged with influencing the investees' activities.
“This is very much a vote of confidence and a vote of optimism in Asia,” said Kalliarekos.
The Asia-Pacific region is expected to record a 4% gain in gross domestic product this year, compared with 3.2% globally, according to a prediction by the International Monetary Fund released on October 11.
“It's expected that the growth of the Asian private market will accelerate at nearly double the pace of global markets through 2025,” Christian Sinding, CEO and managing partner of EQT, said in a press release.
EQT's acquisition of BPEA, one of the oldest and largest PE firms in Asia, helps EQT expand its footprint beyond its strongholds in Europe and the United States to Asia.
How to profit
If you want to invest in fast-growing Southeast Asian private businesses, without doing the hard work, you can invest indirectly through EQT and profit.
EQT AB (OM:EQT) is a private equity firm specializing in buyout investments. The firm focuses on private capital and real asset segments. It seeks to make investments globally to take a majority stake. EQT was founded in 2012 and is based in Stockholm, Sweden and has offices in Europe, North America, and Asia Pacific.
Fundamentals
Earnings (June 29, 2022): SEK8.64 billion (US$776 million)
Revenue (June 29, 2022): SEK17.92 billion (US$1.61 billion)
Market cap (October 24, 2022): SEK231.73 billion (US$20.8 billion)
Rewards
Trading at a 38.4% discount to its true or intrinsic value.
Analysts’ target price is 43.4% higher than the current share price.
Earnings are forecast to grow 30.3% per year, over the next several years.
Earnings grew by 33.6% over the past year.
Financial health is strong and debt is manageable.
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