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Emerging Markets

Chinese VC in London float

Article Date:  May 14 2008 Nick Britton

A company formed to invest in growth businesses operating in China has raised US$25.38 million (£13.1 million) on AIM. Yangtze China Investment will invest in unlisted companies that it expects to benefit from rising spending by the expanding Chinese middle class.

On admission to AIM, Yangtze has acquired three investments it had previously secured for US$9.4 million (£4.8 million). These are consumer goods supplier IGO, 3-D visualisation specialist Creative Picture, and tax-recording technology developer Onbest.

The company will typically invest in revenue-generating, profitable enterprises and look to exit investments within three to five years. Its target stake in investee companies will be between ten and 45 per cent, and it does not intend to invest more than 20 per cent of its assets in any one company.

Wilfred Wong, the chairman of Yangtze China Investment, says the team behind the company have generated an average IRR in excess of 75 per cent for their investments between 2001 and 2007.

Private equity investment into Chinese companies grew 114 per cent to US$30.4 billion in the first 11 months of 2007 compared to the year before, according to venture capital (VC) research organisation Zero-to-IPO.

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