Maximizing Value through Building Platforms
Platform-building is woven into Lunar’s DNA. The business that began as Linktone in 1999 subsequently gave birth to two further companies, Intrinsic and SmartPay. Together they formed the bulwark of Fund I and each of the three has now been fully exited, generating attractive returns. Another platform-building opportunity arose when we acquired Yeehoo in 2011. […]
Incentivizing Minority Shareholders in a Buyout Deal
Chinese private equity has been overwhelmingly characterized by pre-IPO deals and growth capital investments whereby PE returns were driven by the deployment of investment capital, not human capital or sweat equity. Most firms lacked the culture, will and expertise to take on operationally challenging investments. Meanwhile the scale of buyout opportunities has grown, driven by […]
Asian Private Equity Uninspired by China IPO Thaw
By Paul J Davies Asian private equity managers have poured cold water on hopes that the reopened market for initial public offerings in China will spark a flood of profitable sales, and free up the industry to raise more money and stimulate deals. Private equity investors across Asia, and especially in China, have struggled to […]
The Peng Dynasty
In March of 2013, Liyuan Peng, appeared before the media spotlight for the first time as China’s new first lady. While she is a well-known folk singer, she used her new role to signal support for China’s continued drive toward domestic innovation and consumption – through fashion. Peng’s outfits were simple and elegant, and rather […]
E-Commerce in China – An Update
Recently, we opined on the challenges for e-commerce in China, particularly with regards to trust, privacy, payments and logistics. We noted the distinctive characteristics of the Chinese e-commerce ecosystem, credited online platforms for providing convenience and choice, but expressed concerns regarding profitability. A year has passed and despite superlative growth in volumes, profitability remains unclear […]
China Private Equity Returns Plummet
HONG KONG, July 11 (Reuters) – Profits from China's private equity deals have fallen since 2007, a new industry report says, leading to a sharp decline in funds for small and mid-size companies in the world's second largest economy. China's private equity industry emerged later than its North American and European peers, but has become […]
Dark Ages or Renaissance for China PE?
China’s private equity market is either going through the dark ages or a renaissance, depending on whom you ask, with advocates for both sides represented at the HKVCA China Private Equity Summit this week in Hong Kong. The deceleration of China’s economic growth and bottleneck in IPOs for mainland companies has had a knock-on effect […]
Fraud in China ‘Too Hard’ to Detect
Discovering fraud in potential investee companies is becoming more difficult, meaning many China GPs are steering clear of take-private deals, delegates heard at the HKVCA China Summit 2013. A panel of private equity investment professionals offered words of caution over the privatisation of Chinese businesses from stock exchanges globally at the 12th China Summit organised […]
Safety First: Investing in China’s Food Supply Chain
Driven by rising disposable incomes and lower confidence in food safety, Chinese consumers are willing to pay a premium for quality. PE firms have identified the opportunity, but taking it can be difficult. Fifteen years ago, Charles Shao left his career as a technology investor in the US and returned to China to set up […]
Change Afoot for Investors in China’s Retail Sector
As the economy slows and midtier brands lose favor with consumers who are switching to premium brands and to shopping online, China's retail sector is changing. The result is that private-equity firms that once bet on sky-high consumer growth are now buying into restructuring situations or into companies that cater to more-sophisticated tastes. “Going from […]
