Chinese automaker BYD, property developer Vanke launch $154m tech & logistics fund

Employees manufacture electric vehicles at the BYD Coach and Bus factory in Lancaster, California, U.S., on Thursday, Oct. 5, 2017. Photographer: Patrick T. Fallon/Bloomberg

BYD, a Chinese automobile manufacturer backed by Warren Buffett, has joined forces with residential real estate developer China Vanke to launch a fund that will invest 1.1 billion yuan ($153.93 million) into the technology and logistics sectors.

The partnership, which was sealed on September 30, will see BYD Auto Industry, an affiliate of BYD, inject 600 million yuan ($83.88 million) into the new fund as a limited partner. Vanke’s subsidiary in southwestern China’s Chengdu city, Chengdu Vanke Real Estate, will also serve as a limited partner by investing 500 million yuan ($69.90 million), BYD announced in a filing with the Shenzhen stock exchange on Tuesday.

A Tianjin-based investment management firm, whose name can roughly be translated from Chinese as Rongtai Growth Investment Management, agreed to inject one million yuan ($139,810) in the new fund as a general partner.

Rongtai Growth Investment Management was founded in June 2017 in northeastern China’s Tianjin city. Wu Ting, a senior executive of IDG Capital, serves as the company’s actual controller with a 52 per cent stake.

The new fund will mainly make direct investments in technology and logistics companies, or finance sub-funds with investment focuses in the two areas, said BYD in the filing.

The three companies will each assign one person to serve as a member of the new fund’s Investment Committee, according to another document filed by Vanke.

“Our participation in launching the new fund has strengthened the company’s cooperation with professional investment institutions, which will help the firm access investment resources in the automotive industry, enhance our industry investment capabilities, and lift our competitiveness in the sector,” said BYD.

BYD, founded in February 1995 and headquartered in Shenzhen, is a manufacturer of automobiles, battery-powered bicycles, buses, forklifts, rechargeable batteries, trucks and other products.

The company will offer 21 electrically-powered heavy-duty trucks to American brewery Anheuser-Busch as part of a government project. The electric trucks, named BYD 8TT, are scheduled to go into service by the end of 2019.