TPG partners CICC Capital to set up China Synergy investment platform

An employee places genuine Chinese one-hundred yuan banknotes into a counting machine at the Counterfeit Notes Response Center of KEB Hana Bank in Seoul, South Korea, on Friday, July 13, 2017. Yuan is set to slide for fifth week, longest losing streak since July 2016, as escalating U.S.-China trade tensions weigh on sentiment. Photographer: SeongJoon Cho/Bloomberg

Global alternative investment firm TPG and CICC Capital, the private equity arm of China International Capital Corporation (CICC), has inked an agreement to jointly establish the China Synergy platform, it said in an announcement on Thursday.

The flagship platform is set up with a USD/RMB dual-currency structure to give it flexibility to target investment opportunities in both China and overseas.

The platform is designed to carry out cross-border investments on a global scale with specific focus on China and aims to assist non-Chinese companies to expand into the home market and to assist Chinese companies to grow with global support.

However, both PE firms did not disclose the fund size of the platform.

The platform will be advised by a team of seasoned investors including TPG founder and chairman David Bonderman, CICC CEO Mingjian Bi, and senior advisor of CICC and former president of GIC special investments Teh Kok Peng, who will all sit on the steering committee.

“This represents a powerful opportunity for TPG to expand our presence in the country. The platform is complementary to our existing business and it is a solid step in our journey to build on our offerings to fast-growing Chinese companies at all stages. The China Synergy platform, by promoting China’s industrial development and the internationalization of Chinese enterprises, will play a role in bringing positive social impact to the Chinese economy.”said TPG Capital Asia co-managing partner Tim Dattels.

A shareholder of CICC, the $103-billion TPG was one of the first private equity firms to invest in Asia, beginning with its first dedicated fund in 1994. Both firms expect to strengthen their cooperation through the joint initiative.

“We are excited to collaborate with TPG for this great opportunity. Through this platform, we aim to help Chinese companies develop core competitiveness through integrating global resources, at the same time, zeroing in emerging areas in China’s industrial transformation.

“We look to contribute to China’s industrial transformation and upgrade by bringing advancements and good practice to China and actively assist in international companies’ expansion into Chinese market,” said CICC Capital CEO Wei Ding.

CICC Capital currently runs government-backed funds investing in emerging industries, restructuring, USD and RMB funds of funds, and USD and RMB private equity funds with various strategies including venture capital, growth, buyout and distressed investment. It boasts a total AUM of about 300 billion yuan ($44.2 billion).

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