Yingke PE has raised 1 billion yuan ($150 million) for a new RMB-denominated fund in a sign that fundraising by blue-chip investment companies in China is largely immune to pandemic-induced city lockdowns and business suspensions.
The Shanghai-based firm announced the closing of the RMB fund on Monday, right before authorities in the city ended a two-month lockdown on June 1.
“Yingke PE and our LPs [limited partners] have overcome many difficulties raising the new fund during Shanghai’s pandemic controls, which underscores LPs’ trust in us,” said Mingfei Qian, the company’s founder and CEO, in a statement.
Qian said the new fund has already backed two companies, without divulging the names of the investees.
Yingke PE, which is 30% controlled by China’s state capital, closed the RMB fund with commitments from LPs mostly consisting of the country’s government-owned, large-scale financial institutions.
The firm plans to double down on investments in its focused areas of biopharmaceuticals, core technologies, and new energy in China.
In the statement, Yingke PE said it has deployed nearly 3 billion yuan ($448.1 million) to almost 20 investments so far this year. Nearly half of the capital — 1.37 billion yuan ($204.7 million) — was made into seven companies including real estate construction company Beijing Rishengda Construction Enterprise Group and energy storage service provider Wanxiang A123.
With an LP network spanning financial institutions, insurers, local governments, and large-scale enterprises in China, Yingke PE has been stepping up efforts to stock up more dry powder over the past two years. It raised a total of approximately 20 billion yuan ($3 billion) last year, following a fundraising sum of over 15 billion yuan ($2.2 billion) in 2020, according to public information compiled by Chinese local media.
Yingke PE, founded in 2010, has more than 50 billion yuan ($7.5 billion) in total assets under management (AUM), of which over 90% are from Chinese financial institutions and state-owned companies. Its team of nearly 100 investment professionals has invested in almost 300 companies to date.
Yingke PE manages both RMB- and USD-denominated funds.
Statistics from Chinese media outlet TMTPost show that the first quarter of 2022 saw the establishment of 1,354 RMB funds in China, which is about 67.7 times the number of newly-launched USD funds amid rising difficulties for Chinese businesses to go public in the US.
These RMB funds raised about 377.8 billion yuan ($56.4 billion), up 11.6% from the same period in 2021; while the combined fundraising size of the new USD funds dived by 62.6% from Q1 last year.
Earlier this month, global healthcare investment firm Vivo Capital had held the first closing of a new RMB fund at 4 billion yuan, with a total fundraising target of about 10 billion yuan. DealStreetAsia learned from a source that Primavera Capital Group is also targeting a 10-billion-yuan carbon neutrality fund.
Huaxing Growth Capital, the PE arm of Hong Kong-listed China Renaissance, announced in the same month the first closing of its fourth RMB fund at 3 billion yuan. Cedarlake Capital, meanwhile, closed a new RMB fund at 1.25 billion yuan to focus on investments in smart manufacturing and new energy vehicles (NEV), among other sectors.