Hong Kong Investment Corporation (HKIC), the government-owned investment firm that manages HK$62 billion ($7.94 billion), has formed a strategic partnership with the city’s homegrown artificial intelligence (AI) unicorn SmartMore.
This partnership comes as HKIC, widely perceived as the city’s version of Singapore’s Temasek Holdings, is set to make its first batch of widely-anticipated startup investments in June.
The development comes about 18 months after Hong Kong’s Chief Executive John Lee Ka-chiu first announced the launch of HKIC in his maiden policy address in October 2022, to leverage the government’s reserves to finance the development of Hong Kong’s economy and technological innovations.
HKIC appointed Clara Chan Ka-chai, former executive director of Hong Kong’s de facto central bank Hong Kong Monetary Authority (HKMA), as its CEO in October 2023.
Under the partnership, SmartMore will prioritise Hong Kong for its future listing, build the city’s first AI research institute, cultivate young AI talent, and invest resources to improve computing power, the companies announced on Wednesday during a ceremony in Hong Kong, according to China Daily.
While the financial terms of the partnership remain undisclosed, SmartMore is understood to have secured one of HKIC’s first direct investments in startups, according to two people with knowledge of the matter. The sources declined to be named as the deal is private.
Launched in 2019, SmartMore has provided AI-powered intelligent manufacturing solutions to nearly 300 corporate clients worldwide with Apple, Carl Zeiss, Tesla, and BYD among some of its biggest clients.
SmartMore announced its unicorn status with a valuation of over $1 billion in June 2021, after the completion of its Series B round at $200 million. A range of bluechip private market investment firms such as IDG Capital, HongShan, ZhenFund, as well as Lenovo Capital and Incubator Group participated in the round.
In an interview with South China Morning Post (SCMP), Chan said that HKIC would make its first batch of direct investments and co-investments this month with a focus on three major industries, namely hard & core technology, biotech, and new energy & green tech.
“We will only invest in companies which have the potential to deliver a good return for our investment, while they must also help to leverage the capital for encouraging technology companies to use Hong Kong as their base of development,” said Chan.