Chinese buyout firm Trustar Capital is adjusting its exit strategy for Hong Kong-based condiments portfolio Amoy Food after having cancelled the original auction process, according to three sources familiar with the situation.

It has now shifted to engaging bilaterally with several strategic players, such as Chinese condiments giant Haitian Flavoring & Food, to restart talks, said the sources.

The sponsor has cut its valuation expectation for Amoy Food to around USD 150m, from the previous USD 300m, according to the first source.

Trustar has also consulted with some banks about a potential IPO for the business, but has yet to kick off a formal process, said the first source.

All these adjustments came after a Southeast Asian buyer, the final bidder in AMOY’s auction process, walked away in the middle of the year, and the original auction process had to be cancelled, said the first source.

Amoy’s EBITDA has been flat in the past two years, averaging around USD 12m-USD 14m, said the first source.

The business is affected by the US tariffs as it exports around 50% of its products to the US, both the first and second sources said.

Strategic players like Haitian would prefer targets with local production sites in overseas markets like the US to expand the global market, said the second source, adding that Amoy does not have production capacity in overseas markets.

This news service reported last April that Trustar was still seeking buyers despite having seen a valuation mismatch with potential bidders. The PE firm has been marketing the asset since the middle of 2023 and had hoped to complete the Citi-advised deal before the end of 1Q24, according to Mergermarket’s report in December 2023.

Trustar Capital declined to comment. AMOY Food and Foshan Haitian & Flavoring did not reply to request for comment.