HONG KONG, May 14 (Reuters) - Hong Kong-listed real

estate fund manager ESR Group ( ESRCF ), currently valued at

$5.4 billion, halted trading in its shares on Monday, saying

that a group of investors has proposed to take it private.

It said its backer, U.S. private equity firm Warburg Pincus

LLC, and ESR's founders believed the proposal was in the best

interest of ESR shareholders, and were in discussions with the

consortium.

ESR said in an exchange filing after the market close that

it had received a non-binding, conditional proposal from a

consortium controlled by Starwood Capital Group, Sixth Street

Partners and SSW Partners that could result in a delisting.

It said that the proposal, which it received on April 25,

would give its shareholders a choice between cash and rolling

their shares into the future private company, subject to the

terms of the final roll-over arrangements.

ESR shares jumped 22.8% to HK$12.28 when it resumed trading

on Tuesday, their highest since Sept. 7, 2023.

The company did not disclose financial details, or say what

conditions needed to be met or when a formal offer is expected.

The consortium would likely consider making an offer that is

in line with the average 20%-to-30% premium paid in Hong Kong

take-private deals in recent years, said two people with

knowledge of the situation. That would apply to ESR's last

closing price of HK$8.35 before the proposal was submitted.

Such an offer would value the company at up to HK$45.7

billion ($5.85 billion), based on Reuters calculations.

The sources, who declined to be identified as the

information was confidential, stressed that terms were not final

and there was no certainty a deal would be finalised.

ESR said it has hired Citigroup as financial adviser to help

evaluate the proposal.

The consortium is being advised by Morgan Stanley, two

separate sources said. The bank declined to comment.

ESR declined to comment further as did a representative of

the consortium, which already owns about 15.7% of ESR.

ESR said it has formed an independent board committee whose

consideration of the proposal was at a "preliminary stage".

ESR's share close at HK$10 on Friday, the highest since

March 4, valued it at $5.4 billion, according to LSEG data.

The shares have fallen 7.4% so far this year, compared with

a 12% increase in the benchmark Hang Seng Index.

Reuters reported the take-private proposal earlier on

Monday, with sources saying the discussions were at an early

stage with terms yet to be finalised.

ESR manages a range of property-focused funds and its own

property investments. It went public in Hong Kong in 2019 after

pricing its initial public offering at HK$16.8 per share.

Starwood Capital, headquartered in Miami, Florida, has

raised more than $75 billion since its inception in 1991 and has

about $115 billion of assets under management, its website says.

California-based Six Street, founded in 2009, is an

integrated investment firm covering areas including growth,

infrastructure, real estate, direct lending and agriculture

globally, according to its website.

New York-based SSW Partners invests in "high-quality

businesses" and collaborates with partners, offering flexibility

in deal structures, according to its website.

($1 = 7.8141 Hong Kong dollars)