China special: The most active LPs

From sovereign wealth funds that manage the vast social security reserves to major life insurers and growing wealth management platforms, China boasts huge LP potential for private equity funds. Many are already enthusiastic private equity investors, with China Investment Corporation boasting a 40 percent allocation and the National Social Security Fund having a 20-30 percent long-term private equity target.

While many have invested mainly in domestic funds, they are increasingly looking further afield to international GPs with an established track record or to venture capital opportunities, especially in the US. These four are all worth putting on your map on any visit to Beijing.

 Click here to see the LPs on a map.

1. China Life Insurance 
Established in 2003, China Life Insurance Company is one of the largest insurance asset management companies and institutional investors in China. It is an active investor in private equity and more likely to invest with GPs with a successful track record rather than first-time fund managers. It is also open to overseas and co-investment opportunities. 

Recent fund investments
CITIC Private Equity Fund III (2012) RMB11.90bn
Guochuang Oriza Fund of Funds I (2010) RMB5bn
Hony PE RMB Fund II (2010) RMB10bn

Fund strategies
Buyout/Corporate Private Equity, Fund of Funds/Co-Investment, Mezzanine/Debt, Venture Capital/Growth Equity, Other

Regions
Asia-Pacific

Sectors invested in
Energy/Oil & Gas, Financial Services, Transport, TMT, Industrials, Diversified

2. National Social Security Fund
The National Social Security Fund of China is a sovereign wealth fund established in 2000 to serve as a strategic reserve fund accumulated to support future social security expenditures for the ageing population. It has a long term target allocation of 20-30 percent in private equity and has invested mainly in domestic private equity funds including funds managed by Hony Capital and CDH Investments.

Recent fund investments
Fosun Weishi Fund I (2013) RMB2.4bn
SAIF China Growth RMB Fund II (2011) RMB5bn
CICC Jiatai Industry Integration Fund (2011) RMB5bn

Fund strategies
Buyout/Corporate Private Equity, Fund of Funds/Co-Investment, Venture Capital/Growth Equity, Other

Regions
Asia-Pacific

Sectors invested in
Energy/Oil & Gas, Clean Tech/Renewable, Retail, Manufacturing, Natural Resources, Financial Services, TMT, Healthcare, Industrials, Consumer Goods, Diversified, Other

3. China Investment Corporation
Founded in September 2007, China Investment Corporation is a state-owned investment company responsible for managing part of China’s foreign exchange reserves. CIC actively invests in private equity both via funds and direct investments, with a 40 percent allocation to alternatives. In February 2017, China Investment Corporation, Temasek Holdings, and Silk Road Fund and Hopu Investment Management launched the Hou An Innovation Fund that targets $800 million.

Recent fund investments
Asia-Germany Industrial Promotion Capital Fund I (2015) $1bn
Mid Europa Fund IV (2014) €800m
Apax VIII (2012) $7.5bn 

Fund strategies
Buyout/Corporate Private Equity, Fund of Funds/Co-Investment, Secondaries, Venture Capital/Growth Equity, Other

Regions
North America, Central/Eastern Europe, Western Europe, Asia-Pacific

Sectors invested in
Energy/Oil & Gas, Biotech/Life Science, Clean Tech/Renewable, Retail, Manufacturing, Natural Resources, Financial Services, Leisure, Transport, TMT, Healthcare, Industrials, Consumer Goods, Diversified, Business Services, Agribusiness

4. CreditEase
CreditEase is active in the areas of wealth management, credit management, microfinance investment, and is a big investor in private equity. It is eyeing more investments overseas and has partnered with US-based Wellington Management to invest in pre-IPO stage companies and has backed US fintech companies such as Trumid and WeConvene.

Recent fund investments
Shanghai Chenxi Venture Capital Fund (2017) RMB1bn
Gobi Yingzhi Fund II (2015) RMB600m
Incubate Fund 3 (2014) RMB 11bn

Fund strategies

Buyout/Corporate Private Equity, Venture Capital/Growth Equity, Distressed/Turnaround, Secondaries, Mezzanine/Debt, Fund of Funds/Co-Investment

Regions
North America, Western Europe, Asia-Pacific, Middle East/Africa

Sectors invested in
Energy/Oil & Gas, Biotech/Life Science, Clean Tech/Renewable, Retail, Manufacturing, Financial Services, Leisure, TMT, Healthcare, Business Services, Transport, Consumer Goods, Industrials