Candover Asia looking for the next Dr. Reddy's

By Michael Flaherty

HONG KONG (Reuters) - Candover's fledgling Asia unit is seeking deals in the consumer, industrial and energy sectors, with a focus on linking up with mature, market-leading businesses, regional head Jamie Paton said on Tuesday.

Candover (CDI.L: Quote, Profile, Research, Stock Buzz), the London-based and publicly traded private equity group, hired Paton in February from rival 3i (III.L: Quote, Profile, Research, Stock Buzz) to launch its Asia operation.

Paton is a one-man show at the moment, planning to add three to four professionals soon to the small Hong Kong office. He also expects to open an office in Mumbai.

Paton pointed to Indian auto giant Tata Motors (TAMO.BO: Quote, Profile, Research, Stock Buzz), which agreed last month to buy Jaguar and Land Rover from Ford Motor Co (F.N: Quote, Profile, Research, Stock Buzz), as a model for potential home-grown Asian champions.

"Can you find high-quality, sizable business like that in China or India to support making acquisitions both domestically and internationally?" he posed, speaking at the Reuters Hedge Fund and Private Equity Summit on Tuesday.

"Can you find the Dr. Reddy's five years before (it becomes a major global player)," he added.

Dr. Reddy's DRRD.BO, an Indian pharmaceutical company with a market capitalization today of $2.5 billion, bought a German firm from 3i in February 2006.

"That's the kind of place where Candover will go hunting for opportunities, not someone living off a low-cost manufacturing base."  Continued...