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Private Equity in China: Challenges and Opportunities

Book Description

Learn valuable lessons from the newly successful private equity players in China and explore the challenges and opportunities offered in Chinese markets

The first book to deal with private equity finance in China, Private Equity in China: Challenges and Opportunities provides much-needed guidance on an investment concept that has so far proved elusive in Asia. Focusing on the opportunities that the Chinese finance market offers to private equity firms, the book shows how these firms can strategically position themselves in order to maximize success in this new marketplace.

Private Equity in China includes in-depth case studies illustrating both successful and failed ventures by private equity firms operating in China, outlining the challenges faced by private equity firms in setting up new funds. It contains a collection of valuable experience and insights about acquiring companies and turning them around essential for any firm currently operating in, or considering entering, the Chinese market.

  • Discusses the challenges faced by private equity firms in China including setting up the initial fund, fund raising, deal sourcing, deal execution, and monitoring and exit strategies

  • Provides key insights drawn from keen observations and knowledge of the more mature private equity market in Western countries, analyzing the way forward for the Chinese private equity industry

  • Discusses the role of renminbi-denominated funds in the development of the private equity industry in China

Breaking new ground in exploring and explaining the private equity market in China, the book offers incredible new insight into how equity companies can thrive in the Chinese marketplace.

Table of Contents

  1. Cover
  2. Title
  3. Copyright
  4. Dedication
  5. Contents
  6. Preface
  7. Acknowledgments
  8. Chapter 1: Private Equity: An Introduction
    1. Overview
    2. Inventis Private Equity Model
    3. Structure of a Private Equity Fund
    4. Private Equity Investment Process
  9. Chapter 2: Overview of the Political, Macroeconomic, and Financial Landscape in China
    1. Overview
    2. China’s Macroeconomic Conditions and Trends
    3. China’s Financial Markets
    4. Trust Financing
    5. China’s Futures Markets: Commodity Exchanges and Derivatives Exchanges
    6. Summary
  10. Chapter 3: Private Equity in China
    1. Overview
    2. Key Market Trends and Developments
    3. Private Equity Funds in China
    4. Private Equity Investment Structures in China
    5. Leveraged Buyouts
    6. Valuation Adjustment Mechanism
    7. Exit Strategies for Private Equity Investment in China
    8. Benefits of Private Equity for China
  11. Chapter 4: Renminbi Private Equity Fund
    1. Overview
    2. Setting Up and Fund-Raising in China
    3. Investing in China
    4. The Renminbi Private Equity Fund
    5. Challenges and Opportunities for FOPE-RMB Funds
    6. Impacts of RMB Convertibility on RMB Private Equity Funds
  12. Chapter 5: Investment Opportunities for Private Equity in China
    1. Overview
    2. Foreign Acquisition and National Security Review
    3. China’s Five-Year Plan for National Economic and Social Development
    4. China’s Seven Emerging Strategic Industries
    5. Investment Opportunities in China’s Energy Sector
  13. Chapter 6: Challenges and the Future of Private Equity in China
    1. Overview
    2. Fund-Raising
    3. Deal Sourcing
    4. Due Diligence
    5. Deal Structuring
    6. Portfolio Management
    7. Exit
    8. Foreign Exchange Controls and RMB Convertibility
    9. The RMB Fund Advantage—Artificial and Temporary?
    10. Media Reports and Public Perception
    11. Guanxi Management
    12. FOPE-RMB Funds
    13. COPE-USD Funds
    14. Leveraged Buyouts
    15. Private Equity Professionals in China
    16. Conclusion
  14. Appendix A: Government Structure of the People’s Republic of China
  15. Appendix B: Key Points in a Private Placement Memorandum
  16. Appendix C: Geography of China
  17. Appendix D: Selected Private Equity Funds in Greater China
  18. About the Author
  19. Index