Private Enterprises and Debt Markets in China
One of the biggest challenges for small- and medium-sized private enterprises in China is debt financing. A recent study conducted by Development Research Center under the State Council showed that while 66.7% of the SME see bank loans as the primary source of financing, more than 62% of the SMEs are unable to acquire them, […]
Asian funds trend toward country-specific
By Michelle Phillips As private equity in Asia matures, more country-specific funds are expected to emerge as part of a larger trend of localisation and specialisation. Private equity in Asia has been going through a stage of upheaval since the meltdown of 2008, and firms are under increasing market pressure to demonstrate how they differentiate […]
Doubts over take private and re-list
Firms that take US-listed Chinese businesses private and hope to re-list them on Asian stock exchanges may be disappointed with returns, according to an industry panel. By Clare Burrows Private equity firms capitalising on the plummeting share prices of US-listed Chinese companies by doing take-private deals could be disappointed with returns, according to an industry […]
Market Update – The Hidden Affluence of Chinese Households
This month we examine an important question in understanding the power of the Chinese consumer. Is the level of consumption higher than government data suggest, and are China’s rich being captured by official statistics? A recent China Daily editorial called on the Chinese government to enact measures to ease personal tax burdens, break up monopolies […]
Lunar Capital revives King of Walnuts
Shanghai-based private equity fund Lunar Capital Management has acquired a majority stake in Sichuan Zhiqiang Group, the once-prominent walnut producer that later emerged from bankruptcy. Lunar Capital paid US$50 million, including the buyout fee and capital injection, and the firm will be renamed Sichuan Zhiqiang Food. Derek Sulger, a partner at Lunar Capital, said it […]
Lunar Capital gets 60% stake in Chinese beverage brand
By Alvina Yuen Lunar Capital Management has acquired a majority interest in Sichuan Zhiqiang Group, an integrated food manufacturer located in western China, in a deal worth up to $50 million. Through the purchase of a 60% stake in the 15-year-old Sichuan-based beverage brand, Lunar Capital has formed a new Chinese-foreign joint venture corporation to […]
China Yeehoo Sells Control to Lunar Capital, Its Affiliates
China Yeehoo Group Ltd., a Guangzhou-based Chinese baby products retailer, has sold a controlling stake to Lunar Capital Management Ltd. and its affilates. Yeehoo’s existing management team will remain a substantial minority shareholder of the company, while Lunar Capital will appoint a majority of the board of directors and second members of its operation team […]
The mystery of the Chinese consumer
Lily Li wears a lanyard with a little plastic card around her neck, even at weekends. It is a badge of honour: it shows that she has a white-collar job. (She is a secretary at Access Asia, a retail-research company in Shanghai.) She uses Apple earphones for the cheap Chinese mobile phone in her pocket, […]
Lunar Monthly Update
We remain confident that China is attractive for private equity investors. Long-term growth prospects remain robust, driven by ongoing urbanization, rising consumption, and the emergence of inland China. Capital markets continue to develop, broadening exit opportunities for private equity investors. Financing channels for private enterprises remain scarce, making private equity an attractive source of liquidity […]
Lunar Monthly Update
IPOs have been the dominant exit form in China since 2007, creating an “IPO-or-Bust” mentality among the Chinese private equity community that is characterized by an overwhelming focus on public markets. A corollary has been the “Pay-up-for-PIPES” trend. From 2005-2010, PIPE or Mezzanine/Pre-IPO transactions have accounted for over half of private equity deals in China, […]
