SHANGHAI (Reuters) – Morgan Stanley (MS.N: Quote, Profile, Research), the second-biggest U.S. investment bank, has agreed to pay $18 million for a 10 percent stake in China’s Kebao & Boloni Kitchen & Bathroom Furniture, Boloni Chief Financial Officer Sun Yu said on Tuesday.

Beijing-based Boloni, a luxury furnishings and interior company 25 percent owned by an investment arm of Legend Holdings, also aims to launch an initial public offering in Hong Kong in two years, Sun said in a telephone interview.


Morgan Stanley’s previous private equity investments in Chinese companies include Mengniu Dairy (2319.HK: Quote, Profile, Research), cement maker Shanshui Group and China Paradise, which was later acquired by Gome Electrical Appliances (0493.HK: Quote, Profile, Research).

China’s kitchen furnishing market has grown to an estimated 1 million kitchens this year, up from 500,000 two years ago, although this is only a small portion of the country’s $30 billion furniture market, according to industry data company Research and Markets.

Boloni’s revenue this year is expected to jump 67 percent from last year to 1 billion yuan ($136 million), the company said.

(US$1=7.3306 Yuan)

(Reporting by Samuel Shen; Editing by Edmund Klamann)