Hony to raise fifth USD fund

The Chinese private equity firm is nearing a final close on its second RMB fund and will soon raise a USD fund with a target of at least $1.4bn.

Chinese private equity heavyweight Hony Capital is planning to raise a fifth USD-denominated fund, a spokeswoman for the firm confirmed to PE Asia.

However, the target size and a timeframe for the fundraise were not disclosed.

A source told PE Asia that the fifth fund would not be smaller than its predecessor, Hony Capital Fund 2008, which closed on $1.4 billion. A Reuters report said the fund will begin fundraising before the end of this year.

Just last month, the firm collected almost RMB10 billion for its second RMB fund, which has a hard-cap target of RMB10 billion. The firm is currently in the final stage of closing the fund, the source said.

The spokeswoman told PE Asia in November last year that all LPs in the firm’s maiden RMB fund have come back onboard. Among them, China’s Social Security Fund committed RMB3 billion.

Speaking at the PEI Asia Forum held in Hong Kong in April, Hony’s chief executive John Zhao said that China was integrating itself with the national community and that it was not “a choice” to have one type of fund without the other.

“To be a leading country manager you need to have a complete spectrum of products,” Zhao said, while noting that for now at least, “we have a firm view our USD fund will always bigger” than its RMB fund.