PE firm Warburg Pincus raises $2b for new China-focused fund

Warburg Pincus LLC has raised a new $2 billion fund that will focus on growth investments in China, the New York-based private equity (PE) firm said on Thursday.

The new vehicle – Warburg Pincus China – is the firm’s first dedicated fund for that country, and will be a companion fund to Warburg Pincus Private Equity XII, L.P., a $13.4 billion global PE fund that closed in late 2015.

The China fund closed with third-party commitments in excess of its $2 billion hard cap after six months in the market, and will focus on sectors such as consumer, energy, financial services, healthcare, technology, media and telecommunications, the firm added.

The limited partners (LPs) in the new vehicle are from Warburg’s other funds, and also include new investors from public and private pension funds, sovereign wealth funds (SWFs), insurance companies, endowments, foundations and high-net-worth individuals.

In a joint official statement, Charles R. Kaye and Joseph P. Landy, Co-CEOs of Warburg Pincus, said, “We are pleased to announce the close of our China fund. Since our first investment in China in 1994, Warburg Pincus has been a consistent presence in the region. We have now invested over $7 billion in 90 companies, generating strong returns for our investors.”

“The response to Warburg Pincus China reflects our established track record, our very talented team, and the significant opportunities we see for growth investing in the country,” they added.

Warburg has been investing in China since 1994, and so far, the PE major has invested $7 billion in over 90 companies in that country.

Speaking on their Chinese investments, Julian Cheng, Managing Director and Co-Head of China, Warburg Pincus, shared:  “Over the past two decades, we have partnered with some of the most successful entrepreneurs and companies in China and our pipeline is robust. With our long-standing franchise and profile in the region, we are well positioned to continue generating substantial deal flow.”

Warburg Pincus’ current investments in China include Amcare, ANE Logistics, China Huarong Asset Management, China Kidswant, D&J China, ESR Group, Evercare, Hygeia, Liepin, Mofang Apartment, UCAR Inc., Uxin Ltd. and ZTO Express, among others.  Its recent partial and full exits include CAR Inc., China’s largest car rental company;, China’s leading lifestyle services platform; and China Biologic Products, a plasma-based biopharmaceutical company.

Frank Wei, Managing Director and Co-Head of China, added, “We attribute our persistent record to identifying growth themes and partnering with talented management teams.  We will continue to invest behind long-term secular trends such as consumption, urbanization, mobile technology, healthcare, and the ongoing evolution of the financial sector.  This new China fund provides us with additional capital to continue to back high-growth Chinese businesses.”

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