Hosen Capital Targets $1 Billion Fund for Asia Food Acquisitions

(Bloomberg) -- Hosen Capital Ltd. is looking to raise as much as $1 billion to buy stakes in Asian food producers, and predicts that more companies will be up for grabs in the region.

It will be the Beijing-based private equity firm’s third dollar-denominated fund, and its biggest, founding partner Hang Wang said in an interview. Hosen is looking for targets in the region, including in Japan, South Korea and Taiwan, he said.

“Mergers and acquisitions is a trend, so this will demand a larger fund,” Wang said, adding that fundraising will begin by June.

Hosen already manages a $130 million and a $460 million fund; the first made fourfold returns and, with more than half of the second invested, it expects at least a similar earning. The firm also made a fourfold return on the $58 million invested in hot pot restaurant chain Haidilao International Holding Ltd. last year, Wang said.

Asia’s private-equity market is booming and now accounts for 26 percent of global assets, having doubled in share over the past decade, according to data from Bain & Co. Firms such as Hosen, which mainly focus on the agriculture and food sector, are betting that the world’s most populated region will throw up unprecedented opportunity as incomes rise.

Hosen also has yuan-denominated funds totaling $446 million, and two of the firms in which it’s invested have applied to go public on the new, high-profile venue for technology stocks. More are expected to do so, Wang said.

Wang sees more companies being put up for sale in Asia. He cited as an example a wave of Taiwanese businessmen who arrived in China in the 1990s and, as they approach retirement age, are looking to cede control to new investors. Hosen’s sponsors include Temasek Holdings, New Hope Group Co. and Mitsui & Co., according to Hosen’s website.

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