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Asia & Africa: April 2003

South Africa's private equity industry shows mixed results, CalPERS backs Japanese turnaround fund and India continues to attract private equity firms…

GRIC founder launches China-US private equity venture
The founder and chairman of GRIC Communications Hong Chen has launched an advisory and private equity investment firm. The newly formed Hina Group will focus on cross-border M&A advisory services and private equity investments in communications and technology companies in China and the US. Hina Group is raising two funds. The first fund will focus on investment opportunities emerging from the restructuring process of Chinese state-owned enterprises. The second fund has been created to acquire or invest in publicly traded US telecom equipment and software companies with depressed stock market valuations but with the potential to tap emerging market opportunities in Asia.
AltAssets 15.4.03

CalPERS backs Japanese turnaround fund
The California Public Employees' Retirement System is to invest $200m in a WL Ross fund targeting Japanese turnarounds and will receive a 20 per cent stake in the fund's management. The fund hopes to raise a total of $1bn, which it will use to invest in small, distressed Japanese companies. New York private equity firm WL Ross manages about $1.6bn of investments in Japan, including three private equity funds and stakes in Japanese companies.
PrivateEquityOnline 14.4.03

US Investor plugs into Indian IT
Oak Investment Partners is the latest private equity firm to attempt to tap the potential of the Asian markets by setting up an office in India. The firm is hoping that it can buy into the country's reservoir of technology services. Yet its foray into this market comes at a time when deal opportunities are drying up. Indeed, many private equity firms are withdrawing from their Indian ventures, such as AMP of Australia and Dresdner Kleinwort Capital.
Financial Times 15.4.03

Private equity waiting for rain
South Africa's private equity industry continues to struggle as it experiences a third consecutive year of lower fundraising. The annual survey from KPMG and the South Africa Venture Capital and Private Equity Association reported that the latest drop was in response to the low levels of new commitments, investor caution and the availability of undrawn commitments. But investment activity did see a slight upturn in fortune with R3.9bn invested in 2002, compared to R2.4bn in 2001. In contrast, M&A activity halved in 2002, dropping from R502.4bn in 2001 to R242.4bn last year. One positive result from the survey was that due to the appreciation of the rand the industry was boosted in dollar terms and South Africa has re-entered the world's top 20 private equity industries by investments, having dropped off the list last year after the rapid depreciation of the rand.
News 24 9.4.03