LDC commits $30m to Chinese growth fund

The commitment is the UK firm’s first in Asia since opening an office last month in Hong Kong.

Lloyds TSB Development Capital (LDC) has committed $30 million to China New Enterprise Investment Fund II (CNEI), marking its first investment in China.

CNEI invests in established Chinese growth companies and is managed by New Enterprise Management partners Xiaoyang Yu, Johannes Schoeter and Hirosuke Sakai. It is targeting a final close of $250 million to $300 million, according to PRE Management’s website. PRE Management, an Oslo-headquartered asset manager, is raising a fund of funds, PRE China I, to commit to CNEI’s second fund.

LDC and CNEI have also formed a partnership agreement on future co-investment opportunities.

LDC opened a Hong Kong office in January – its first outside Europe. The Hong Kong team’s remit is twofold: firstly, to create a network of Asian “contacts and capabilities” to benefit LDC’s UK portfolio companies; and secondly to develop direct investment capability in India and the Chinese mainland.

Craig Wilkinson, previously an investment director at LDC’s Leeds office, heads up the new office. The firm aims to build its Asia team out to six professionals, including a senior Asia adviser and two local Chinese investment executives.