U.S. private equity firms are making further inroads in Asia.

Overnight, Carlyle announced it raised $1.04 billion for its fourth Asian growth capital fund — nearly double the size of its previous such fund.

The fund has already made investments into companies including the high-end Chinese women’s apparel maker Ellassay. Fundraising is exceptionally tough right now for private equity firms. Carlyle said nearly 40 percent of the fund’s investors are new and that it raised the fund in 14 months, reflecting improved investor sentiment towards China and India.

Blackstone, increasingly aggressive in Asia, on Monday hired an executive from Deutsche Asset Management to lead its capital raising efforts across the Asia-Pacific region. The firm has also been talking to the Shanghai city government to set up a wholly owned China subsidiary as it prepares to launch a local currency private equity fund, sources previously told Reuters.

Deals of the day: 

* Japan’s Shinsei Bank and Aozora Bank, two loss-making lenders backed by U.S. investors, are likely to announce plans on Wednesday to merge by next year, two sources familiar with the matter said.  
 
* Shareholders in Australian investment firm Macquarie Communications Infrastructure Group voted in favour of a $1.3 billion takeover offer from the Canada Pension Plan Investment Board (CPPIB). 

* Belgium-based RHJ International is close to a deal to buy a stake in Opel after talks between parent General Motors and preferred bidder Magna International hit snags. 

* Swedish software company Global Gaming Factory X AB said it had agreed to buy free file-sharing website The Pirate Bay, and that it would find ways to compensate copyright owners for downloaded material. 
    
* Shanghai Airlines expects a detailed plan for a long-anticipated merger with China Eastern Airlines to emerge next month, a senior executive at the airline said. 

* Finland’s Ruukki Group Plc said it would acquire Australia’s platinum-group metals producer Sylvania Resources Ltd for 268 million euros ($378.1 million) under a merger implementation agreement.

* Russia’s Alfa Group, locked in a five-year boardroom war with Telenor, has halted talks with the Norwegian telecoms group on a potential merger of their Russian and Ukrainian assets, an Alfa official said.

General Motors is heading back to bankruptcy court on Tuesday to seek approval to sell its choice assets to a “New GM” in a plan to reinvigorate the automaker under U.S. government ownership.

Reuters reporters Emily Chasan and Caroline Humer will be filing updates from the hearing in the live headline box below and on the DealZone Twitter feed.

Roche’s megabucks Genentech buy is looking more like a reverse takeover — in some ways, at least.

The Swiss drugmaker splashed out $47 billion to buy out its biotech partner to secure access to Genentech’s impressive new drugs. But Roche’s U.S. operations are to operate under the Genentech name and research, development and commercial operations are all being based at the U.S. group’s South San Francisco headquarters.

Now Roche doesn’t even consider itself Big Pharma. It says it will leave the industry group Pharmaceuticals Research and Manufacturers of America (PhRMA) but will retain Genentech’s membership of the Biotechnology Industry Organization (BIO).

“As part of the world’s largest biotechnology company, Genentech and Roche believe that BIO’s purpose is closely aligned with the direction of the new company and, therefore, can represent the company’s interests in Washington, among policymakers, legislators and the general public,” Roche said in a statement.

PHOTO CREDIT: People are reflected in a window (R) as they walk past the headquarters of Swiss pharmaceutical company Roche in Basel February 4, 2009. REUTERS/Christian Hartmann

General Motors (GMGMQ.PK) is talking to rival suitors to sell a stake in Opel, the Financial Times says,  primarily Brussels-based RHJ International (RHJI.BR). Magna is still in pole position.

Japan’s Shinsei Bank and Aozora Bank are likely to announce plans to merge by next year, sources familiar with the matter say. The two loss-making lenders are backed by U.S. investors. Read the Reuters story here.

For more Reuters news on deals, click here. Below are two other stories we spotted in newspapers.

Private equity group Candover (CDI.L) has received approaches from trade buyers for Ontex, the Belgium-based maker of diapers and wet wipes, the Financial Times says .

Activist hedge fund firm The Children’s Investment Fund (TCI) is considering offering more flexible terms to investors and a different fee structure, the Wall Street Journal says.

FirstGroup, the Aberdeen-based transport group led by its chairman Martin Gilbert, confirmed on Monday that it made an approach for smaller, embattled National Express on June 19.

But, National Express’s newly appointed chairman, John Devaney, and his chief executive, Richard Bowker, believe they can go it alone and have firmly rebuffed First Group. They are hoping, instead, to launch a £400 million rights issue.

This is not the first time the two companies have been linked as merger partners: there was talk three years ago of doing a £3 billion, nil-premium merger.

This time, however, FirstGroup made its opportunistic all-share merger proposal to National Express, after talks broke down between the British government and National Express over a bail-out of its London-to-Edinburgh East Coast Mainline franchise.

“No bail-outs in rail” is the government’s stance on the matter. No surprise there, then, when the coffers over at Treasury are empty.

“National Express now faces the choice of either racking up huge losses at East Coast or defaulting on the franchise, which would mean exiting UK rail altogether,” believes UK broker Collins Stewart.

National Express has been particularly hit hard from the cost of the East Coast line. To pay the government £138 million per year, it needs annual passenger revenue growth of at least 9 percent. It has only managed 0.3 percent in the first quarter.

That doesn’t put National Express in a very good position, when it has around £1.2 billion of net debt on its balance sheet. Indeed, its shares have more or less collapsed over the course of the year by around 70 percent, despite being confident that it will meet its renegotiated debt covenant tests tomorrow.

Advised by JPMorgan Cazenove, FirstGroup is clearly exploiting the situation, given that up until this point its strategy had always been focussed on cash generation and organic growth while it lumbered under a £2.5 billion debt pile.

“Without rail and with a sensible balance sheet structure – our sum-of-the-parts points to a fair value of around 500p for National Express,” says Collins Stewart. That’s about 70 percent above where the company’s share price is currently.

Buying National Express would make First Group into the UK’s biggest transport company. Failing that, there are plenty of other companies out there that might look to do a deal during these hard times: Arriva, Go-Ahead, and Stagecoach all come to mind.

By Steve James

Although Enterprise Products Partners CEO Michael Creel could not join a conference call with analysts to dicuss his company’s planned $3.3 billion acquisition Teppco Partners, the energy pipeline company was quick to reassure investors all was well.

“He is not hiking the Appalachian Trail, he is not in Argentina and his wife IS with him,” Randy Burkhalter, Enterprise’s executive in charge of investor relations, told the call.

It was a joking reference to South Carolina Governor Mark Sanford, who last week admitted cheating on his wife with a woman in Argentina, where he had disappared for several days. His office had told reporters during his absence that Sanford was hiking the Appalachian Trail.

A spokesman for Houston-based Enterprise said Creel was “out of town” and was unable to take part in the analyst call.