China's CPE reaches first-close of US$3b new private equity fund: source

[HONG KONG] China's CITIC Private Equity (CPE) aims to raise US$3 billion in a new dollar-denominated fund and has reached a first-close of US$1.8 billion, a person with direct knowledge told Reuters on Friday.

CPE is planning to complete the fundraising by year-end, said the person, who declined to be named as the information is confidential.

After the first-close, which happened a week ago according to the source, CPE can now start deploying capital from the new fund while investors can continue to commit funds to it.

Some of the firm's existing investors, including Singaporean state investors GIC and Temasek, re-upped their commitments to the new fund, said the person.

CPE, which counts ride-hailing firm Didi Chuxing and JD Health International Inc in its portfolio, did not immediately respond to a query for comment.

Its fundraising comes as PE firms in Asia tap markets flush with liquidity due to authorities' post-pandemic economic stimulus measures, while pension funds and other investors hunt better returns in a low interest rate environment.

Asia-focused funds raised US$126 billion in 2020, down 39 per cent year-on-year and nearly 50 per cent less than the average of the previous five years, Preqin's data showed.

The total is likely to rise this year as more funds are launched with market conditions also becoming favourable for PE firms to exit portfolio companies. As of last week, 108 new funds have raised US$53 billion, Preqin said.

KKR & Co Inc earlier this month said it raised US$15 billion for its fourth Asia-Pacific focused fund.

Hong Kong-based Baring Private Equity has also recently launched a new fund targeting US$8.5 billion, according to separate people with direct knowledge. The firm declined to comment.

Founded in 2008, CPE was the investment arm of China's top brokerage CITIC Securities but was spun off in 2018, when it raised a US$2.3 billion dollar fund. It now has over 100 billion yuan (S$20 billion) worth of assets under management, its website shows.

REUTERS