CICC Capital, the flagship private equity (PE) platform of China International Capital Corp (CICC), has held the first close of a new RMB-denominated fund at about 1 billion yuan ($145.1 million) to back new economy startups in southern China’s Greater Bay Area (GBA).
The fund, whose Chinese name can be directly translated into “CICC (Shenzhen) New Economy Venture Capital Partnership (Limited Partnership)”, will invest in new economy areas including advanced technology, high-end manufacturing, healthcare, consumption, new energy, and new materials.
It will focus on investment opportunities in GBA, an area that includes Hong Kong, Macau, nine municipalities in the Guangdong Province, as well as the provinces of Guangxi and Hainan in southern China.
The new fund “will take full advantage of the growth momentum of new economy. It targets to help promote China’s national technologies achieve a strategic goal of becoming independent and self-reliant”, said the firm in a statement.
CICC Capital completed the registration of the fund with the country’s funds regulator Asset Management Association of China (AMAC) on March 28.
The new economy-focused fund will add to CICC Capital’s portfolio of funds targeting RMB- and USD-denominated equity investments, fund-of-funds (FOF), real estate, and infrastructure investments.
The past year saw CICC Capital’s accumulated assets under management (AUM) grow 12.5% to over 450 billion yuan ($65.3 billion) from approximately 400 billion yuan with the addition of more than 40 funds.
Its direct investment funds, which accounted for about 59% of its accumulative AUM as of end-2022, have focused most firepower on the new energy and high-end manufacturing industries.
With new energy and high-end manufacturing companies representing 30% of its direct investment portfolio, CICC Capital has also invested heavily in mass consumption, finance, healthcare, real estate, and infrastructure. These sectors have contributed to 29%, 16%, 15%, and 10% of the firm’s direct investment portfolio as of the end of last year, CICC Capital disclosed in a WeChat post earlier this year.
Days before the launch of its GBA new economy fund, CICC Capital teamed up with Shanghai-listed chip design firm GigaDevice Semiconductor to set up a 500-million-yuan ($72.6 million) fund for investments in emerging technologies.