CDH Investments has raised $500 million for the first close of its latest fund, CDH Fund IV, three sources have confirmed.
CDH declined to comment.
According to the sources, Beijing-based CDH is now targeting commitments of $1.4 billion for this fund – a lower target than the firm initially set out with. Two sources said the fund initially entered the market looking to raise $2 billion, while the third source told sister site PEI Asia that the original target was $1.5 billion.
Investors in funds raised by CDH in the past include UK government-backed CDC Group, the Government of Singapore Investment Corporation, International Finance Corporation and fund of funds manager Asia Alternatives.
CDH China Fund III, this fund’s predecessor, closed on $1.6 billion. The first and second growth capital funds reportedly raised $103 million and $310 million respectively.
The firm also manages two venture capital funds, the first of which closed on $200 million in 2006. Details of the second venture capital fund are not known.
In 2008, the firm launched fundraising for an RMB-denominated fund, reportedly targeting commitments of RMB5 billion ($732 million). China’s National Social Security Fund is said to have committed RMB2 billion to that fund.
CDH Investments was set up in 2002 as a spin-off from China International Capital Corporation (CICC), an investment bank. The firm is headed by Wu Shangzhi, the former head of CICC's private equity group.
CDH came in at number 14 in this year's PEI Asia 30, PEI Asia's first annual ranking of the 30 largest private equity firms in Asia Pacific and the Middle East, which was released in June. The PEI Asia 30 is calculated based on the amount of private equity direct investment capital raised or created over the five preceeding years.
As of April 2009, CDH managed $3 billion across private equity, venture capital and long/short public equity. The firm was awarded 'Best Private Equity Firm in China' in this year's PEI global private equity industry awards.