Investment firm PAG raises 3.1 billion yuan in first yuan-denominated buyout fund: sources
[HONG KONG] Asia-focused investment firm PAG has raised 3.1 billion yuan (S$553 million) at the first close of its inaugural yuan-denominated buyout fund, exceeding its target, two people with knowledge of the matter said, as it looks to deepen investments in China.
The fundraising comes amid a slowdown in China's dealmaking as economic headwinds and geopolitical tensions deter many Western investors from the world's second-largest economy.
Private equity-backed deals targeting Chinese companies totalled US$8.1 billion in the first half of 2025, the lowest since 2013, preliminary data from LSEG shows.
PAG's private equity arm, led by veteran dealmaker Shan Weijian, has secured anchor investment for the yuan fund from the government of Suzhou, a city in China's eastern Jiangsu province, the sources said.
Other investors in the fund include a number of Chinese insurance companies, they added.
PAG is still fundraising, but first-round commitments have surpassed its initial target of 3 billion yuan, the sources said, who declined to be identified as the information is not public.
BT in your inbox
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
Sign Up
Sign Up
Private equity funds typically begin investing after their first close.
PAG, which manages more than US$55 billion of assets with its main offices in Tokyo, Hong Kong and Singapore, declined to comment.
In April 2024, public disclosures on a Suzhou government-affiliated website showed that Suzhou Xiangcheng Fund Management Co planned to commit to a PAG fund, which has an estimate size of 3 billion yuan.
Suzhou Xiangcheng Fund Management did not answer calls seeking comment.
The government of Suzhou declined to comment.
Only three China-focused private equity funds, including all currencies, have been raised so far this year, totalling a mere US$140 million, Preqin data showed.
Overall fundraising has been on a sharp decline since 2021, from US$129 billion in 2021 to US$11 billion in 2024, the data showed.
PAG and other buyout firms that have traditionally relied on US-based investors for their Asia-focused funds have increasingly turned to domestic capital for Chinese deals over the past three years.
In 2023, Warburg Pincus said that the Chinese city of Yixing had agreed to invest in its first yuan-denominated fund, focused on the healthcare sector with an estimated size of 3 billion yuan.
As of Monday, mainland China-based investors had committed a total of 814.4 billion yuan of capital to private equity and venture fund managers this year, up 43 per cent from the same period in 2024, according to local data provider ZERONE.
PAG's yuan fund will focus on mergers and acquisitions for a controlling stake, combined with structural minority equity investments, a disclosure on the Suzhou government-affiliated website showed.
The fund will invest in a wide range of sectors including consumer, technology, healthcare and financial services, it showed.
PAG's current Chinese team, mostly based in Beijing and Shanghai, will be responsible for both yuan and US dollar-denominated investments, said the people.
The firm closed its fourth pan-Asia US dollar buyout fund in 2024 at about US$4 billion, much lower than the initial US$9 billion target, said the two people.
Earlier this year, it announced final closing of a US$1.25 billion significant risk transfer fund and a US$4 billion real estate fund.
PAG signed an agreement with Suzhou New District in February 2024 to establish a PAG China headquarters in the city.
Most recently, the firm led a consortium to acquire 48 shopping malls from property developer Dalian Wanda, a disclosure by China's market regulator in May showed.
Last year, PAG also led a group of investors to acquire a 60 per cent stake in Wanda's mall unit for US$8.3 billion. REUTERS
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Times
an hour ago
- Business Times
China will be able to navigate around restrictions imposed by others, emerge more resilient: PM Wong
[BEIJING] Whatever restrictions it may face from other countries, China is likely to find a way around them by developing its own capabilities, Prime Minister Lawrence Wong said on Wednesday (Jun 25). China's response to increasing geopolitical contestation was among the topics that PM Wong tackled in a wrap-up interview with Singapore media, towards the end of his introductory visit to China. He noted increasing attempts by countries 'to weaponise economic interdependencies and identify potential choke points as leverage, all in the name of security and resilience'. But the more a country does this, the more others are incentivised to find alternative solutions and sources, he added. 'Be it high-end semiconductor chips or rare earth materials, there will always be alternatives. So what may appear to be leverage today may very well disappear, or the leverage will be minimised down the road.' This is already playing out today, he said. 'Whatever the restrictions or controls (that) may be imposed on China, I'm quite sure China will find a way, navigate its way around them.' BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up He added: 'China will redouble its efforts, as it's already doing, to develop its own indigenous technology, strengthen its R&D (research and development) base – which is happening – and emerge more resilient from this process.' On China's economic prospects more broadly, he noted that its property market has become more stable and the economy continues to do well, with efforts to boost consumption. A large share of the workforce is also still in the rural and agricultural sector, he noted. This means there are 'tremendous opportunities' for urbanisation and modernisation, to uplift hundreds of millions of Chinese. Bringing temperatures down While US-China relations are 'in a state of flux' and no one knows what will happen next, it is good that talks have 'helped to bring down the temperature', said PM Wong. He hoped for continued constructive engagements that allow both sides to find a way forward. Singapore and Asean member states have also been engaging the US, he noted. His hope is that the eventual reciprocal tariffs imposed by the US on Asean countries will be lowered 'closer to 10 per cent, if not 10 per cent'. Even so, such a rate would still be three times higher than in the past, he cautioned. 'So we have to be realistic. We are going to be in a world where barriers are higher, and we will have to find ways to navigate around this new environment.' As for other geopolitical tensions, including in the Middle East, PM Wong said that Singapore wants to have good relations – which goes beyond 'being friendly, saying polite words, handshakes and hugs'. While good rapport is important, having good relations means building on substance, he said. 'Singapore must have relevance, and we must be able to offer something on the table to our partners.' One way to stay relevant is by being an effective interlocutor, he said. Singapore has a reputation as 'a trusted, reliable, principled partner' and 'honest broker', trusted to facilitate conversations even among those who disagree. This is even more important in a world of growing tensions and greater separation, he added. Strengthening bilateral ties Since arriving in China on Jun 22, PM Wong has met Chinese Premier Li Qiang and President Xi Jinping in Beijing, and attended the World Economic Forum's Summer Davos 2025 in Tianjin. In his wrap-up interview, the prime minister reiterated that his visit builds on strong foundations laid by his predecessors. Long-running joint projects, such as the Suzhou Industrial Park and Tianjin Eco-city, remain platforms for cooperation – and are entering new areas such as digital technologies, renewable energy and even modern services, he said. Beyond two-way collaboration, a new area with 'some potential' is for Singapore and China to cooperate in a third country, said PM Wong, noting that this is the goal of the Third Country Training Programme announced on Monday. The programme is for government officials from Asean member states and Timor Leste, which is slated to join the bloc. It aims to improve regional capacity to tackle long-term challenges in sustainability and resilience. PM Wong said that he had good conversations with the Chinese leaders, 'quite candidly and openly' discussing not just bilateral issues but also regional and global developments. He hoped to continue these valuable conversations and has invited Li and Xi to visit Singapore at their convenience. On Wednesday night, the prime minister also met Singaporeans living in China, ahead of the end of his official trip on Thursday.
CNA
an hour ago
- CNA
More attempts by countries to 'weaponise economic interdependencies': PM Wong
BEIJING: Amid current geopolitical contests and rivalries, there have been "more and more attempts" by countries to "weaponise economic interdependencies", Prime Minister Lawrence Wong said on Wednesday (Jun 25). Countries are also identifying 'potential choke points' as leverage, all in the name of security and resilience, he added. Speaking to journalists before meeting Singaporeans at a reception in Beijing, Mr Wong was responding to a question about whether he discussed with Chinese leaders how to move forward from the US tariff situation. 'But sometimes, the more one country does this … it incentivises others to find alternative solutions and sources,' said the prime minister. "There will always be alternatives, be it high-end semiconductor chips or rare earth materials. 'So what may appear to be leverage today, may very well disappear, or the leverage may be minimised down the road. And I think this dynamic is playing out even today,' he added. Whatever controls or restrictions are imposed on China, Mr Wong said he was quite sure China would find a way to navigate its way around them. This is his first trip to China as prime minister – holding meetings with Chinese Premier Li Qiang and Chinese President Xi Jinping, as well as speaking at the World Economic Forum Annual Meeting of the New Champions, or Summer Davos. The US tariffs are an evolving situation, he said, adding that "no one really knows what will happen next". Singapore hopes that the US and China will continue to engage each other constructively and that both sides can find a way forward, said Mr Wong. The Association of Southeast Asian Nations (ASEAN), including Singapore, has been engaging the US, he said, adding that he hopes the tariffs on ASEAN countries will come down closer to 10 per cent. Even at 10 per cent, this is still three times higher than what the tariffs used to be, said Mr Wong. 'So we have to be realistic. We are going to be in a world where barriers are higher and we will have to find ways to navigate around this new environment.' SINGAPORE AN "HONEST BROKER" When asked about his discussions with Chinese leaders on geopolitical tensions, including conflict in the Middle East, Mr Wong said Singapore wants to be friends with everyone, but having good relations is 'not just a matter of being friendly, saying polite words, handshakes and hugs'. While good rapport is important, having good relations means "building on substance", he said. 'It means Singapore … must have relevance. And we must be able to offer something on the table to our partners. And then working with them, we can identify areas of shared interests to collaborate on,' said Mr Wong. When other countries are keen to gain or learn something from Singapore, it can engage different countries and deepen collaboration, he added. Singapore can also add value by being an 'effective interlocutor', said the prime minister, noting the country's reputation as an 'honest broker'. "People trust us to facilitate conversations, even among parties who may not always have the same views ... We can help bring people together and strengthen partnerships," said Mr Wong. "This is more important today in a world where there are growing tensions, in a world that's facing pressures to become more separated." Commenting on his meetings with the Chinese leaders, Mr Wong said he had 'very good conversations' with Mr Li and Mr Xi, adding that they were able to discuss not only bilateral issues but also wider regional and global developments, exchanging views 'quite candidly and openly'. He also invited both Chinese leaders to visit Singapore. Noting that he is 'not unfamiliar' with China, Mr Wong added that there is a shared commitment from all sides to advance cooperation between Singapore and China. With the Suzhou Industrial Park project marking its 30th anniversary in 2024, the project is 'very successful' and there is potential for this to be done in a third country, said Mr Wong. Singapore and China intend to jointly develop a third-country training programme for ASEAN countries and Timor-Leste. It will focus on key areas such as clean energy transition, sustainable urban development, climate resilience and support for the ASEAN power grid. 'This is yet another way where China and Singapore can come together, jointly develop causes for the region and help build up the capabilities of our fellow ASEAN member states,' said Mr Wong.
Business Times
an hour ago
- Business Times
Japan's NTT DATA Group targets July listing of data centre Reit on SGX: sources
[SINGAPORE] Japan's NTT DATA Group could list its data centre real estate investment trust (Reit) on the Singapore stock exchange as early as July, two sources with knowledge of the matter said, in a deal that could raise up to US$1 billion. The company is looking to lodge its IPO prospectus with the Singapore regulator as early as this week or early next week, the sources said on Wednesday (Jun 25), and was in the process of engaging cornerstone investors. The sources declined to be identified as the information is confidential. Cornerstone investors are large institutional investors that subscribe to an IPO offering before it is open to the public. 'We are aiming to go public during FY2025. However, the specific timing will be determined based on market conditions,' NTT DATA Group said in an emailed response to Reuters on Wednesday. Its 2025 fiscal year runs from April 2025 to March 2026. 'Additionally, in order to be listed, we need to undergo the review and approval process by the Singapore Stock Exchange, and the approval timing is not yet certain,' the company noted, adding that it had not yet disclosed the planned IPO amount. A NEWSLETTER FOR YOU Tuesday, 12 pm Property Insights Get an exclusive analysis of real estate and property news in Singapore and beyond. Sign Up Sign Up The listing, if it proceeds, would be the biggest in Singapore since the US$977 million IPO of Digital Core Reit in 2021, LSEG data showed. There is growing interest from companies seeking to list on the Singapore Exchange (SGX), after the city-state announced measures in February to strengthen its equities market, including a 20 per cent tax rebate for primary listings. Hong Kong-listed China Medical System said on Tuesday that it had applied for a secondary listing of its shares on SGX. NTT's data centre Reit is expected to include four data centres in the US, one in Austria and one in Singapore, one of the sources said on Wednesday. REUTERS
