China’s Legend Capital plots ‘strategic’ fund for large-ticket LPs – exclusive

The firm is also raising capital for its eighth flagship fund and second healthcare fund, targeting more than $1bn for both vehicles.

Beijing-based manager Legend Capital has a launched a “strategic fund” catering to larger investors amid capital raising efforts for its eighth flagship private equity fund and second healthcare fund, Private Equity International has learned.

Details on the offering are scant. It is unclear, for example, how much capital is targeted for the new fund and what time horizon it will have, only that it is a specific mandate for large-ticket LPs, a source with knowledge of the fundraise told PEI.

Investors in Legend’s previous funds included Texas County and District Retirement System, 57 Stars, Adams Street Partners, CDC Group and National Council for Social Security Fund of China, according to PEI data.

Legend could not be reached for comment by press time.

The firm’s move into “strategic fund investing” could be similar to products from larger global firms, such as CVC Capital Partners, which is currently in the latter stages of raising its second Strategic Opportunities fund – a long-term vehicle whose predecessor invested capital for a small handful of large institutions.

Blackstone and Apollo Global Management have in recent years expanded their menu of offerings for their LPs. Blackstone has its Tactical Opportunities Fund, which looks at opportunities in complex, time-sensitive or dislocated markets. Apollo has Hybrid Value, a long-term vehicle that will combine credit and equity, focusing on capital solutions, structured equity and non-control stressed and distressed investments.

Legend has so far raised more than $500 million for LC VIII, which is aiming to raise as much as $1 billion, according to the source. Investor re-ups for the fund are strong and new LPs have also contributed to the fund, the source added. The firm expects a final close by June this year. The target for LC VIII is more than double that of its predecessor, the 2016-vintage LC VII that collected $448 million against a $375 million target.

LC Healthcare Fund II, meanwhile, is seeking $250 million – similar to its 2016-vintage predecessor – and is nearing a first close, said the source. It is unclear how much has been raised so far for the vehicle.

Legend is a subsidiary of Chinese conglomerate Legend Holdings and manages about 40 billion yuan ($6 billion; €5.3 billion) across private equity and venture capital funds, according to the firm’s website. It has backed start-ups, expansion stage investments, pre-initial public offering and post-IPO companies in China TMT, healthcare, culture and sports, professional services and intelligent manufacturing.