CDH-backed Syswin raises $67.2m through NYSE IPO

The Chinese private equity firm last year invested $30.5m in the real estate service provider for a 19% stake.

CDH Investments-backed Syswin, a Chinese real estate service provider, has raised $67.2 million through an initial public offering on the New York Stock Exchange (NYSE).

The company sold 9.6 million American Depositary Shares (ADSs) at $7 each, according to its prospectus filed to the US Securities and Exchange Commission. It will use the proceeds to expand its business into new markets, establish real estate financial services, and upgrade IT systems and training programmes.

The shares were last traded at $6.2 on the stock exchange on 24 November.

Based in Beijing, Syswin provides real estate sales agency services to property developers of new residential properties as well as consultancy services. The company currently has operations in 17 cities across China.

China-focused CDH invested $30.5 million from CDH Fund III in Syswin for a 19.29 percent stake in January 2009. The private equity firm did not sell its interest in the company through the IPO but its stake was diluted to 15.46 percent.

This is the second portfolio company of CDH that went public on NYSE this month.

On 2 November, Xueda Education Group sold 13.43 million ADSs at $9.5 each, raising $127.6 million. The firm invested $10 million in the tutoring services provider in October 2007 for a 21.5 percent stake, which was diluted to 16 percent.

Established in 2002, CDH closed its fourth USD fund on its $1.4 billion hard cap in January. The fund was heavily-oversubscribed but the firm agreed to cap the fund’s size at $1.4 billion under pressure from its lead investors, an industry told PEI Asia at the time.

The fund’s predecessor closed on $1.6 billion, while the firm’s first and second growth capital funds raised $103 million and $310 million respectively.

Limited partners in these funds include UK government-backed CDC Group, the Government of Singapore Investment Corporation (GIC), International Finance Corporation (IFC) and Hong Kong-based fund of funds manager Asia Alternatives.

In 2008, China’s Social Security Fund (SSF) committed RMB2 billion to the firm’s first RMB fund, which reportedly had a target commitment of RMB5 billion.