Editor’s take: The week that was – March 8-13

Deal-making by China-focused private equity and venture capital firms slowed for a second consecutive month in February, amid the week-long Lunar New Year holidays on the Mainland. There were 122 PE-VC deals in the month that raised a combined $5.2 billion, according to proprietary data compiled by DealStreetAsia. The total value of investments was down 30.7% from January, while the number of transactions decreased by 14.7%. Dealmaking in China has had a slow start in 2021 after the record set last December when $9.1 billion was raised across 191 deals.

Meanwhile, in India, funding activity gained momentum in February, the shortest month of the year. Startups raked in $1.3 billion on the back of heightened deal-making in the logistics/distribution and financial services sectors. According to our data, startups raised $1 billion in January. In the corresponding period last year, the fundraising scenario was completely different when the pandemic was yet to hit India. VC funding in startups touched $1.5 billion across 75 deals in February 2020.

Do check out our weekly data tables capturing prominent VC/PE transactions from India, China and SE Asia.

Moving on to our top exclusives this week

Asia-focused secondaries investor NewQuest Capital Partners, which is majority-owned by global PE major TPG, has deployed one-third of its fourth fund, according to the firm’s Singapore-based partner Amit Gupta. In an interview, Gupta told DealStreetAsia that “secondary transactions were few and far between in Asia five years ago, but we are seeing signs of maturity of the secondary market here in Asia.” The firm is now looking at the Southeast Asian market opportunistically.

Singapore-based Fullerton Healthcare Corporation is on the block and has initiated talks to sell up to 100 per cent stake in the company. The company’s earlier plans were to divest only a part of its stake.

Indonesian beauty platform Social Bella, known by its Sociolla e-commerce brand, is in talks with investors to raise around $75 million in a new funding round. Social Bella closed its $58-million Series E round last year backed by Temasek, Pavilion Capital, and Jungle Ventures.

Indonesian private investment firm Arkblu Capital is targeting to make up to four direct investments into startups this year, while also looking at potential venture capital funds to invest in. Arkblu follows a two-fold strategy where it invests both in startups as well as VC funds.

Meanwhile, co-founders of Kopi Kenangan, Indonesia’s largest venture-backed F&B chain, have formed an investment vehicle to make selective bets on promising early-stage startups in the country.

From Vietnam, we reported about a shift in investment strategy by South Korean VC Nextrans, which is planning to bet more money on later-stage firms, as the country witnesses a spate of growth-stage businesses that are carving out expansion plans after surviving the pandemic.

ADB Ventures, the venture investing arm of the Asian Development Bank, plans to deploy half of its first $60 million fund over the next three years. Dominic Mellor, ADB’s principal investment specialist who set up and co-manages the bank’s VC unit, spoke to us about the investment strategy and plans to raise a second vehicle to provide debt funding.

The IFC is considering participating in a $180 million financing for the Vietnamese animal and aqua feed producer Greenfeed Vietnam Corporation.

Analysis and deep-dives

We find out why despite having a plethora of tech companies in Vietnam, PE interest in the sector remains tepid, with most fund managers ramping up their focus on brick-and-mortar businesses in areas such as real estate, retail and healthcare. In 2019, as many as six out of 17 PE deals in Vietnam were sealed in the tech sector. In 2020, only two out of 11 investments were tech-related, according to our data.

Shares of banks and technology companies have witnessed a sharp rally on the Indonesia Stock Exchange this year. Fuelling the surge in the technology stocks is the recent IPO plans of the sectoral giants — Gojek, Tokopedia, and Bukalapak — which investors hope will boost the fortunes of the entire ecosystem.

Adding another perspective to the developing digital banking play, we had this analysis on how Indonesia’s banks, backed by the region’s tech-savvy startups and major investors, are gearing up to transform the financial landscape of the severely underbanked nation, as they combine reach and financial heft. In the process, many of the country’s young fintechs may be forced to take the new competition head-on.

Headline deals

Singapore-headquartered cybersecurity company Snyk has raised a total of $300 million in its Series E funding round backed by state investor Temasek, giving the firm a post-money valuation of $4.7 billion.

Warburg Pincus and Hillhouse Capital will co-lead a $700 million Series A financing round in JD Property, the infrastructure asset management and integrated service subsidiary of Chinese online retailer JD.com.

Southeast Asia-based venture capital firm East Ventures said it will take control and assume management of EV Growth, an Indonesia-focused growth fund. Established in 2018, EV Growth was a JV between East Ventures, Sinar Mas-backed SMDV, and Yahoo! Japan Capital.

Indonesian state-backed digital wallet LinkAja has snagged an investment from ride-hailing and payments platform Gojek as part of its ongoing Series B round, which has now exceeded $100 million. LinkAja had earlier in November last year secured funding from Gojek rival Grab which led the Series B round along with existing investors Telkomsel, BRI Ventures, and Mandiri Capital.

From our Greater China and India desks

We tracked a spate of deals worth over $50 million from the Greater China region. Hong Kong-based fintech startup WeLab has garnered as much as $75 million led by Allianz X, a digital investment unit of Germany’s Allianz Group. This marks the first close of its Series C-1 round that has brought the total corpus raised by WeLab to over $600 million.

Clinical-stage biopharmaceutical firm Gmax Biopharm International has secured $78 million in a Series C round led by state-backed conglomerate China Merchants Group.

Shanghai-based beauty brands omnichannel partner Ushopal has bagged $100 million in a Series D round led by FountainVest Partners.

Chinese engineering equipment supplier Zhongneng United Co Ltd has completed its Series C2 and C3 rounds of financing raising a total of $461 million.

Arctic Vision, a China-based clinical-stage ophthalmology company, has raised over $100 million in a Series B round led by Loyal Valley Capital.

Fadada, a Chinese e-signature and cloud contract service provider, has pocketed $138.3 million in a Series D round from Tencent, Centurium Capital, and ZWC Partners.

Game developer MetaApp has raised $100 million in a Series C round led by SIG China, the local arm of the US trading and broking firm SIG.

Chinese mobile intelligent terminal solutions provider Shanghai Longcheer Technology has raked $100 million in a Series B round after the firm’s failed listing attempt three years earlier.

Insurtech platform Turtlemint has raised funding from Singapore-based Jungle Ventures, its first investment in the category, bringing the startup’s Series D fundraising to a close at $46 million.

Software-as-a-service startup Icertis has raised around $80 million as part of its Series F round, led by existing investor B Capital Group, with participation from Greycroft, Meritech Capital Partners, Premji Invest, PSP Growth, and e.ventures. Post-funding, its valuation has nearly tripled to $2.8 billion.

 SPACside Story

The SPAC frenzy continues unabated as this route becomes increasingly popular for closely-held businesses to raise capital for growth.

Grab Holdings Inc is in talks to go public through a merger with a special purpose acquisition company that could value the ride-hailing giant at nearly $40 billion, Reuters reported. SoftBank-backed Grab is in talks with Altimeter Capital Management LP and is expected to raise between $3 billion and $4 billion from private investors.

Hong Kong’s New Frontier Group is in talks with investment banks about an IPO via a SPAC, Reuters reported. The China-focused investment firm aims to raise $300 million from the SPAC IPO.

Baring Private Equity Asia is considering listing Citiustech Healthcare Technology in the US through a merger with a SPAC, Bloomberg reported. Baring Asia could seek a valuation of about $1 billion for Citiustech in a listing.

Model Performance Acquisition, a Hong Kong-based blank check company led by ex-Templeton Asset Management North Asia private equity co-head Claudius Tsang, has filed to raise up to $50 million in an IPO to pursue targets in Asia.

L Catterton Asia Acquisition Corp, a SPAC launched by consumer-focused private equity firm L Catterton, announced the pricing of its $250 million IPO on Nasdaq. The SPAC may pursue an initial target business in high-growth, consumer technology sectors across Asia.

On the fundraising trail

Singapore-headquartered Openspace Ventures announced the final close of its third Southeast Asia fund – Openspace Ventures III LP – at $200 million. The third fund’s close raises Gojek-backer Openspace’s total committed capital managed to $425 million across three funds.

KKR & Co Inc is seeking to raise $12 billion for its flagship global fund that will invest in infrastructure assets such as oil and gas pipelines and renewable energy projects, Bloomberg reported.

SIP Global Partners, a US- and Japan-headquartered venture capital firm, has made a $75 million first close of its debut fund that seeks to invest in early-stage US startups with the potential to expand into Japan and other Asian markets.

CBRE Global Investors has raised $100 million so far for a Japan-focused logistics fund, CBRE Asia Value V Japan Logistics Co-Investment SCSp, per its filing with the SEC.

Chinese private equity firm CICC Capital has tied up with the UK-based pharma giant AstraZeneca to set up an over $338 million healthcare fund.

Chinese private equity firm Primavera Capital Group, an early investor in billionaire Jack Ma’s Ant Group, is raising a new US dollar-denominated fund of up to $5 billion, Reuters reported.

Singapore’s state investor Temasek has entered into a partnership with global impact investor Leapfrog Investments. Temasek will pump in $500 million in LeapFrog’s funds in lieu of a minority stake as it gears up to provide growth capital to companies across Asia and Africa.

India’s Edelweiss Wealth Management has launched the third series of Edelweiss Crossover Opportunities Fund (Crossover III) with a targeted corpus of about $700 million. The latest fund will focus on late-stage private equity and pre-IPO investments.

Vietnamese early-stage accelerator ThinkZone has tied up with BK Fund, a venture investment fund of the Hanoi University of Science and Technology, to manage and raise $10 million for its first investment vehicle.

Malaysia Debt Ventures Bhd and Kenanga Investment Bank are setting up a fintech fund, with a target fund size of $73 million.

In other news

JD Technology, the fintech unit of Chinese e-commerce giant JD.com Inc., is likely to withdraw its application for an IPO on Shanghai’s technology-heavy Star Market, becoming the latest casualty of China’s wide-ranging crackdown on the country’s sprawling online finance industry, Reuters reported. Meanwhile, China is considering adjusting the investment threshold for Shanghai’s tech-focused STAR Market to boost liquidity and improve rules for the registration system.

Lastly, Philippine-listed real estate developers DoubleDragon Properties Corp and Filinvest Land are lining up shares sales of their REIT subsidiaries in a move that could transform the local bourse as the region’s hotspot for IPOs. These REITs are among the seven IPOs expected this year that will make the Philippine market the leader in the region, after years of being the weakest.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.