A Capital launches €1bn Europe-China fund

The cross-border firm has also set up a 1bn RMB co-investment vehicle to attract Chinese LPs.

Hong Kong-based A Capital has launched a Europe-China technology fund targeting €1 billion, according to a statement from the firm.

The A Capital Technology fund will invest in European firms, aiming to accelerate their growth in emerging markets and particularly in China.

The fund has formed a strategic partnership IMEC, a Belgium-based nanotechnology research center, which aims to “leverage the competence of IMEC R&D and talents in the fields of microelectronics and new materials”, the statement said. IMEC's development strategy in China is also expected to benefit from the fund.

Sector focus is environmental and energy technologies, digital technologies and M2M, medical technologies, transportation and logistics and automation and high-end manufacturing.

ChinaEquity Group, a China-based private equity firm, has made an undisclosed investment in the new vehicle. In addition, ChinaEquity and A Capital have set up a joint RMB co-investment vehicle in China intending to raise 1 billion RMB (€116 million; $160 million) from Chinese institutional and corporate investors.

“Europe has world-leading R&D and innovative companies in the fields of environment, mobility, digital and medical, that lack scale due to fragmentation and low-growth of European markets,” said André Loesekrug-Pietri, founder and managing partner of A Capital, in the statement. 

“China has the market and the need for these technologies to tackle the massive challenges that it faces, in particular environmental pollution, urbanization and healthcare needs. A Capital’s vision is to allow technological European firms to scale and create strong value and jobs, while having a secured framework in the ultra-competitive Chinese market.”

Hong Kong-based A Capital is a cross-border firm providing private equity funding to Chinese companies expanding into Europe. It also co-invests with Chinese strategic investors into European mid-market companies, establishing partnerships between European businesses developing their presence in China.  

The firm’s initial fund was rolled into the A Capital MidCap Fund, which reached a second close on €200 million at the end of 2013, according to the firm.