Report on European PE's view on China released
A pdf of a presentation outlining the results can be found via the blue link directly below (10MB)
2009 European PE report on China
Key Findings
PE Industries view of China
In 2009, China ranked No. 1 among emerging markets for LPs, whereas in 2008 LPs ranked China at #3. GPs ranked China #2 after Central and Eastern Europe. China is a frequent Board Level topic for 43% of Executives, with an additional 50% discussing Chinese activities sometimes. 81.2% of LPs expect an increased allocation to China in the next 5 years.
Impact of the financial crisis on Chinese activities
No LPs, GPs or Executives said that they have stopped activities in China due to the crisis. 14% of GPs have accelerated their activities towards China.
Fundraising
18.2% of LPs raise money in Asia and a further 22.7% plan to raise capital in the future. 13.8% of GPs raise money in Asia and a further 17.2% plan to raise capital in the future.Growing Value via Chinese activitiesGPs expect more portfolio companies to be active in China in three years time. 51.9% of GPs have not discussed China portfolio support yet. GPs expect outsourcing to be the most crucial activity for Portfolio Companies, whereas Executives expect Sales in China to be the main driver of value.
Exits
57.1% of GPs expect exits to Chinese buyers to be a benefit to their business. While 13.8% have already had discussions with Chinese purchasers, none of the GPs had exited to a Chinese buyer yet.Return ExpectationsMost LPs expect a 30% IRR in the next PE cycle in China. Risks of Chinese activitiesThe #1 risk perceived by the participants were: LPs - Unclear Govt. regulations; GPs - Cultural and Language Issues ; Executive - Competition from Chinese competitors.
Epiven to Host Panel Session at 2010 Intl. LP & GP Summit
Key topics that the panel addressed include:
1. Fundamentals of FoF
2. Point of view from LP & GP when assessing FoF
3. China's opportunity/opportunity for improvement from a FoF point of view
4. Chinese transition from a government guided FoF model to a more traditional FoF model
5. Experience of participants in China or comparative experiences between China and other countries
http://www.cvcri.com/forum/2010/sh/english/index.asp
