Orchid Asia closes seventh fund on $1.3bn

The Chinese mid-market manager surpassed its $900m target for its latest vehicle.

Chinese private equity firm Orchid Asia Group has raised $1.3 billion for its seventh vehicle, beating its original target of $900 million, Private Equity International has learned.

The firm launched Orchid Asia last July and held a final close in December, a source with knowledge of the fundraising told PEI.

Limited partners in the fund were mostly from North America, the source added. The Pennsylvania Public School Employees’ Retirement System committed $75 million to the fund and the Teacher Retirement System of Texas committed $100 million, according to PEI data. Its investor base includes a mix of pension funds, private banks, university endowments, insurance companies and family offices.

Fund VII is Orchid’s largest to date. It raised $920 million for its sixth fund in 2014 and $750 million for its fifth fund in 2011. Fund VI is showing a 1.1x net multiple and 13.1 percent IRR as of end March 2017, while Fund V is delivering a 1.7x net multiple and 29 percent net IRR, according to LP documents.

Fund VII will have the same strategy as Orchid Asia’s previous vehicles, focusing on China-based companies in the consumer services and products sector, retail, medical and healthcare, technology, media and telecom, and speciality manufacturing.

Orchid Asia manages approximately $3 billion of assets and has offices in Hong Kong, Shanghai, Beijing and Guangzhou.

Its portfolio includes travel website CTrip, Chinese mobile radio platform Lizhi.FM, and Malaysian funeral services provider Nirvana.