Baring PE Asia weighs US$8 billion deal to merge Hong Kong’s Tricor and Vistra, sources say

Baring Private Equity Asia is exploring a combination of two Hong Kong-based business services firms it owns, Tricor and Vistra, according to people familiar with the matter.

BPEA is working with advisers on a merger that could value its two portfolio companies at $7 billion to $8 billion, the people said, asking not to be identified because the matter is private. The pan-Asian buyout firm – which itself is merging with Swedish investment firm EQT AB – has notified Tricor and Vistra’s creditors about the merger plans, the people said.

To help set a valuation for the merged business, BPEA is weighing selling a minority stake in Vistra, the larger of the two firms, the people said. It’s an option under consideration and BPEA might not proceed with the stake sale, they added.

BPEA completed its purchase of Tricor from Permira in June in a deal that valued the company at about $2.8 billion including debt. The buyout firm subsequently started preparations for a merger of the two business services firms, after having considered a potential sale of Vistra earlier, the people said.

Vistra had drawn preliminary interest from other private equity firms including Warburg Pincus, Bloomberg News has reported. A deal could have valued Vistra at $4 billion to $5 billion, people familiar with the matter said at the time.