Chinese alternative assets manager CDH Investments’ sub-fund, the CDH Mezzanine and Credit Fund, has secured the first close of its industry data centre (IDC) fund at 1.5 billion yuan ($228 million), CDH announced on Monday.
The full target size of the RMB-denominated fund is 2 billion yuan ($304 million) and its investors so far include insurance groups, university endowment funds, and state-owned organisations. The IDC fund is the maiden RMB fund in the data centre industry.
Going forward, the fund will target to forge partnerships with China’s leading data services providers, as well as invest in novel projects across cities.
Beijing-based CDH set up CDH Mezzanine and Credit Fund in 2011, to offer financing for mergers & acquisitions, high growth private businesses, fixed assets investments and non-performing assets. As of April this year, it has over 22.7 billion yuan ($3.5 billion) in assets under management and has invested in 92 companies.
The Mezzanine and Credit Fund has launched five RMB funds and one dollar-denominated fund. It has fully exited from the first two RMB funds with return rate to its investors amounting to 15.1 per cent and 11.5 per cent, respectively.
The latest fifth fund attracted a string of marquee investors including funds of funds, government-backed funds, industry funds, and pension funds.
Before launching the IDC fund, The Mezzanine and Credit Fund has made nearly 1 billion yuan ($1.5 billion) investment in the data industry, and, according to CDH, it has about 10 projects in the pipeline and has made a foray into the overseas market as well.
“Data centres have become an indispensable asset and infrastructure in the era of information technology, which is one of the primary reasons for us to further support,” said Tao Ye, the general manager at Mezzanine and Credit Fund, in the statement.
China’s data centre market was estimated at about 156 billion yuan ($24 billion) in 2019, and is projected to surpass 200 billion yuan ($30 billion) by end-2020.