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* Honiton is now wholly foreign-owned, based in Beijing

* Entire company is valued $200-$250 million

* Honiton’s adviser: Morgan Stanley
(Adds IPO plan, details and background)

By George Chen, Asia Private Equity Correspondent

HONG KONG, Nov 30 (Reuters) – Honiton Energy Group has hired
Morgan Stanley (MS.N) to help the China-focused wind power
developer lure a new investor, in a deal that could value the
entire company at up to $250 million, two people familiar with
the details said on Monday.

The company, currently 100 percent foreign-owned and
headquartered in Beijing, has received first-round bids from
several private equity firms, which valued it at between $200
million and $250 million, said the dealmakers.

The company wants to sell only a minority stake to a new
investor because it is also aiming to list on a major
international market in a year or two, said the two sources, who
declined to be identified because the sale process is
confidential.

Morgan Stanley declined to comment. Officials of Honiton,
which focuses on wind power development in China, especially
Inner Mongolia, could not be immediately reached for comment.

With 100 percent foreign ownership, “this allows the company
to list on any foreign stock market effortlessly and without any
shareholder restrictions,” the company said in a statement on its
website. (www.honitonenergy.com)

“As a renewable energy provider, Honiton will also enjoy
preferential tax treatment from Chinese authorities,” the company
statement added.

The sources told Reuters the first-round bidders included
both Chinese and foreign private equity and hedge funds, and a
deal could be closed before the end of the year.

HOT SECTOR

Honiton owns the rights to five extensive properties in
China’s Inner Mongolia region.

With the potential for each property to produce up to
hundreds of megawatts of power, the production of wind power
could power millions of homes and thereby potentially reduce
several million tonnes of carbon dioxide, the company website
asserted.

Last year, global investments in renewable energy reached
$119 billion, where a fifth was invested in the Asia Pacific
region, according to a report by UNEP Sustainable Energy Finance
Initiative.

China led new investment in Asia, rising 18 percent over 2007
to $15.6 billion, mostly in new wind projects and some biomass
plants.  Continued…