Baring Asia eyes new markets, China still key

By Michael Smith and Alison Tudor

HONG KONG (Reuters) - Baring Private Equity Asia Group Ltd. said on Wednesday it still saw the best value for money in China despite regulatory risks, but expects to broaden its investment base to other parts of Asia.

Baring, which has invested about half of a $490 million fund raised last year, said it was looking at new investment opportunities in Japan, India and Southeast Asia.

"We still think the best value for money in the region right now is in China but we are starting to find a lot more interesting opportunities in other markets as well," Jean Eric Salata, founder and chief executive officer of Baring Asia, said at the Reuters Hedge Funds and Private Equity Summit in Hong Kong.

"We have a fairly active program in India. We are coming across some interesting deals in Southeast Asia, mainly centered around Singapore," he added.

In September 2006, Baring said it had raised $490 million for investment in companies in Asia, including Japan, while assets under management totaled $1 billion.

Salata said Baring had made 10 investments from the fund, including eight in China, and expected three or four more deals.

Baring opened an office late last year in Tokyo, where it hopes to tap into a mergers and acquisitions market expected to grow from $8 billion last year to $50 billion in three years, according to a forecast cited by Salata.

Salata said he expected the Japanese private equity market to expand "several-fold" over the next few years.  Continued...