65 Equity Partners buys stake in Tuya for $134m, aims to list IOT specialist on SGX
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65 Equity Partners CEO Tan Chong Lee said the investment aligns strategically with the fund’s mandate of supporting high quality businesses seeking a listing on SGX.
PHOTO: 65 EQUITY PARTNERS
SINGAPORE - In a move which could attract another listing to the Singapore bourse, Temasek-backed global investment firm 65 Equity Partners is buying into Hong Kong- and New York-listed internet of things (IOT) specialist Tuya Inc.
The deal will see the Singapore fund becoming a 13 per cent owner in Tuya via an investment of US$100 million (S$134 million).
It is buying the stake from venture capital firm New Enterprise Associates.
Tuya is a specialist in producing software which enables household devices to connect or “speak” with each other in a “smart” way.
It had revenue of US$135 million for the first half of 2024 (full-year 2023 revenue was US$230 million) and a market capitalisation of over US$1 billion.
Speaking to The Straits Times, 65 Equity Partners chief executive Tan Chong Lee said the investment aligns strategically with the fund’s mandate of supporting high-quality businesses seeking a listing on the Singapore Exchange (SGX).
“We are investing in high growth, mid-cap companies which are suited for listing on the Singapore market. These would ideally be those in the US$1 billion to US$3 billion range,” he said.
Mr Tan said 65 Equity Partners can help create liquidity for Tuya on the SGX, including by selling some of its shares back into the market if necessary. This would generate institutional and retail interest in a potential listing.
“Very often, secondary listings remain illiquid and unnoticed,” Mr Tan said. “Our mission is to come up with solutions to boost liquidity so that these companies gain a following and attract coverage.”
Established in October 2021, with some $4.5 billion of funds under management, and offices in Singapore, London and San Francisco, 65 Equity Partners invests in established family-owned and founder-led businesses in South-east Asia, Europe and the US across the consumer, industrials, business services, healthcare and technology sectors.
In Singapore, it holds stakes in listed corporate secretarial services company BoardRoom, while in Malaysia it has a stake in car e-commerce platform Carsome.
It is also an investor in Singapore-based immersive exhibition services specialist Neon, and shopping and rewards platform ShopBack. In the US, it has bought into lifestyle group Kendra Scott and custom-engineered appliance designer Felix Storch Inc.
Tuya is the second company, after Nasdaq-listed AvePoint, which the Singapore fund has invested in with the objective of a secondary listing on the SGX.
Having purchased a 10 per cent stake in AvePoint in 2023, 65 Equity Partners is also planning to lead the company to a secondary listing on the local bourse within the next two years.
Mr Tan said the existing geopolitical circumstances have made Singapore an increasingly attractive primary and secondary listing location for global companies.
“For global businesses, Singapore Exchange is a neutral venue. They can become a true multinational with their global headquarters in Singapore. One of the key things we seek to do is value add to these Singapore secondary listings.”
Tuya’s founder and CEO Jerry Wang said this investment reflects 65 Equity Partners’ confidence in his company’s vision to capture growing international markets as the key enabler of global IOT, intelligent devices, commercial and industry applications.
“The Asia-Pacific region, particularly South-east Asia, represents an enormous opportunity for us as it is a fast-growing emerging market,” he said.
“We believe the investment from 65 Equity Partners aligns seamlessly with our international expansion strategy and offers possibilities for a future additional listing on the Singapore Exchange, which will further enhance Tuya’s presence in the global capital markets.”
Of Tuya’s current shareholders, 15 per cent are China-based investors, 15 per cent are US investors and 35 per cent are Europeans. The rest of the shareholding is spread through Asia and Latin America.
Correction note: In an earlier version of the story, it was reported that Tuya has revenue of about US$100 million and a market capitalisation of over US$1 billion. This is incorrect. The firm had revenue of US$135 million for the first half of 2024 (full-year 2023 revenue was US$230 million) and a market capitalisation of over US$1 billion.
