Haitong teams with Fortis on RMB3bn fund

The China-focused joint venture between the Belgian and Chinese firms has already garnered commitments of about RMB2bn for its second fund focused on growth capital and pre-IPO investments.

Haitong-Fortis Private Equity Fund Management, a joint venture between Chinese brokerage house Haitong Securities and Fortis, has launched an RMB-denominated fund for China.

China-Belgium Direct Equity Investment Fund II is targeting commitments of about RMB3 billion ($439 million), Hanker Gu, chief investment officer of Haitong-Fortis Private Equity, said in an interview.

The fund is likely to raise its entire capital from domestic investors and already has commitments of about 2 billion yuan from Chinese institutions, he said. In the future, the firm will consider raising a parallel fund which will target commitments from overseas limited partners, Gu added.

The firm’s second fund will focus on pre-IPO and growth capital investments in the high-tech, industrial, consumption-based and financial services sectors. It is targeting a final close by the end of the first quarter of 2009. The firm normally invests between 20 million yuan and RMB180 million for non-control equity stakes. 

Its first fund was a 1 billion yuan vehicle that is now fully invested across about 20 deals, Gu said.

Besides Haitong and Fortis, other investors in the first fund included the Chinese Ministry of Finance, the Belgian Ministry of Public Enterprises Communication and Participation, China’s National Social Security Fund, China Development Bank, China Banknote Printing and Minting Corporation, China’s State Development and Investment Corporation and Guangdong Strong, a food products manufacturer.

Established in 2004, Haitong-Fortis is based in Shanghai.