CITIC PE closes debut USD fund on $990m

The Chinese private equity firm has raised $990m for its second fund, exceeding the original target of $800m and the vehicle's $900m hard-cap.

Beijing-based CITIC Private Equity Funds Management has closed its debut USD-denominated fund on $990 million.

As revealed in a recent in-depth interview with CITIC PE president Yibing Wu in the latest edition of PE Asia, demand for the fund was so strong it decided to return to its limited partners to request permission to raise the hard-cap by 10 percent to $990m.

In the interview, Wu said: “We have been lucky. I think our strategy resonates with people. We're a China-specific product and we have a large team and are operationally driven.”

The CPEChina Fund, which is CITIC PE’s second fund, was “substantially over-subscribed”, according to a statement. Commitments were received from 39 institutions, including sovereign wealth funds, pension funds, endowments, family offices, funds of funds, banks, insurance companies and other financial institutions from North America, Europe, the Middle East and Asia, the firm said.

An industry source told PE Asia in April last year that the fund was targeting commitments of between $500 million to $800 million.

We have been lucky. I think our strategy resonates with people.

Yibing Wu

The fund will focus on Chinese investments, but will also support international acquisitions made by China-based companies. In sector terms, it will target investments in the manufacturing and technology, financial institutions and services, energy and resources, healthcare, consumer goods and retail industries.

The firm’s maiden fund, the CITIC Mianyang Private Equity Fund, grabbed headlines in January 2010 when it raised RMB9 billion of commitments, setting a new record for China’s RMB-denominated fund industry.

China’s Social Security Fund (SSF) was the single biggest investor in the Mianyang fund, according to a statement released at the time of the close. Wu told PE Asia last year that more than 50 percent of the money raised came from the private sector.

CITIC PE was launched in June 2008 as the private equity arm of state-backed CITIC Securities.