IDG Capital

Whispering IDG Social Security Fund


    June 10, the fourth held in Tianjin, China International Private Equity Forum, the National Social Security Fund Council (hereinafter referred to as Social Security Fund) chairman Dai said in public that the social security fund private equity investments (PE) has reached the number of six, this latest investment, is invested high-tech, new media, known IDG capital.

     PE favored by the social security fund industry sixth "lucky", but the harmonious growth of IDG's Fund, the Social Security Fund decided to invest 1.2 billion yuan. This is the IDG-sponsored team in the domestic RMB funds with a total goal of raising 3.5 billion, per capita investment in all aspects of the present have been identified. In addition to the social security fund, the fund has also attracted the participation of other institutional investors. Investment projects, according to people close to the description, units of the National Science under Chinese Academy of Sciences has decided to invest in the investment PE7 billion.

    Social Security Fund received in April 2008 the State Council approved to invest PE, it immediately became the object of competition for each PE. Social Security Fund is permitted to invest the maximum cost, 10% of total assets, but the social security fund has been very cautious, IDG included in the harmonious growth of investment funds, pension funds invested a total commitment of PE, but 9.2 billion, less than the end of 2009 the total assets of 776.5 billion yuan to 1.2%.

    The IDG is not only on investment, Dai also said that social security funds and the cooperation of several other PE negotiations in progress. This indicates that following the investment of social security funds Hony, CDH, Mianyang and other PE, the new round of investment boom is coming.

    IDG "harmonious growth"

    2009, IDG harmonious growth of the capital to raise investment funds registered in Beijing set up a harmonious love odd Investment Management (Beijing) Limited (Harmony Company), as the manager of the PE. April 2009, including the SAIF, the broadband capital, Hai Tong Securities (10.07, -0.23, -2.23%), New Horizon, the seven fund management team in the Development and Reform Committee, IDG's company is one of harmony One, it has thus become the first venture in the Development and Reform Committee (equity) investment management business.

    Referred the issue to obtain social security investment, IDG Capital Vice Chairman Shong looked very excited that the intention of the Fund's investor base to determine, but other investors "such as social security funds in the first closed it."

    The source told our reporter, originally developed IDG amount of harmonious growth of the Fund's Prospectus is 50 billion, but that the social security fund, IDG team too many funds under management, it is recommended that they reduce the size of the fund. IDG accept the recommendation to reduce the size to 35 billion.

    Shong said that only 20% -25%, the fund will be to invest in early stage of development of small and medium enterprises will invest in the rest of the growing business. As for the upcoming investment industry, he said the focus has been locked items, but it is not publicly disclosed.

    IDG capital into China in 1992, was the first to enter the Chinese market is one international investment fund, currently manages the total fund size of 2.5 billion. Content from the website to see IDG, IDG's investment list covering hotels, websites, consumer and other industries, leading enterprises atmosphere, such as Ctrip, Home, Baidu, search room, Tencent, Kingdee, the financial sector, Sohu, Wumart, where the customer Eslite, the Han court, etc., and more than 50 companies in the United States, Hong Kong, China and other capital markets, or through mergers and acquisitions successful exit.

    Vice Chairman of IDG Shong capital in the PE sector can be said to be active people. He McGovern founded IDG in 1993 to help venture capital funds, and IDG is also responsible for 15 countries in Asia or the region. Hugo Shong, Department of Foreign Languages in 1982, graduated from Hunan University, Graduate School of CASS in 1984, was admitted to the department of journalism at Boston University in 1987 Master of Mass Communication, Law and Diplomacy  Latter enters  Fletcher studying Economics and International Business in Asia Graduate courses in 1996 graduated from Harvard Business School Advanced Management Program.

Social Security and prudent

    PE for social security and investment in the Fund, after walking a bit slow. Dai in May this year, "2010 Forum on Chinese equity investment fund" on the interpretation of PE investments in the social security fund "on the surface looked slow", but "we are from the sound system, and strengthen professional management, etc., to promote this work . "

    Dai also said that social security fund for investment in PE not in a year or two once limit is reached, but should be on the market, according to the conditions step by step, "to hurry out of good projects, good projects not to wait."

    April 2008, the National Social Security Fund announced the approval by the State Council, Development and Reform Commission may be approved by the Investment Fund and the Development and Reform Commission for the record industry's market-oriented equity investment fund, Bohai Industrial Investment Fund, the ratio of fund, CITIC Industrial Mianyang fund, invested in CDH, Hony, creating a market-oriented investment in PE funds set a precedent for the team access to social security.

    As the development of contemporary Chinese PE is one of the most important institutional investors, pension funds want to have more agencies in this market.

     "Social Security Investment in these funds, there are other large institutional investors, such as Lenovo behind yi, Mianyang behind CITIC Securities (12.77, -0.19, -1.47%), and so on. We understand that while social security funds want to control their own investments in a single fund in the proportion of the fund which also hope to have more institutional investors. because institutions and high net worth individuals, families, tolerance for risk, after all, different. "PE funds, a charge of investor relations people correspondents said.

    Adhere to prudent investment of social security on the one hand the principle, on the other hand efforts to foster a PE market. Many fund managers said that, in addition to the establishment of the Development and Reform Commission special approval or record of the hard targets, but also on social security issues such as the qualifications of fund managers gradually formed its own set of standards.

    First, the social security records adhere to investment performance of the team, though this team is not too much in China, but the social security always Ningquewulan. This is a lot of PE investors adhere to the principle for years. There was a large FOFs (Composite Fund), manager of the correspondents said that they have a high degree of social security in this area of consensus, "the first idea to use the correct results justify the investment, followed to show that this long-term success of the investment team can work together , both of which are indispensable. "

    In addition, according to correspondents learned that Social Security will be strictly limited to PE investment in this asset category. Some infrastructure projects would also like to fight for social security equity investments, but the risks and rewards of such assets and atypical PE project, although the project is very good, but ultimately decided not to participate in the social security fund investment.

    Dai once the Social Security Fund invested An examination of the standard summary of the "four" meaning that the independence, professionalism, effectiveness, focused. Meanwhile, formal social security fund before investing, as well as a series of investigative procedures. The first is social security fund for senior staff with the PE "closed-door talk with", the two sides exchange views on issues of concern and efforts to resolve. Subsequently, the PE will be given to a fund-raising instrument of social security before they can begin to go due diligence, negotiations and final approval process.

The next lucky?

    According to the meeting in Tianjin, Dai said the contents of the social security fund has also conducted due diligence on a number of PE and another "For some PE, is about to vote the second time," Dai said.

    Sources said the Social Security Fund has capital of RMB funds and CITIC Shanghai Financial Industrial Investment Fund to carry out due diligence, while the second phase is being investigated Hony RMB funds.

    Back in 2008, reports circulated on the market and the social security fund, CITIC Capital to be set up jointly by the news of RMB funds. The end of 2009, CITIC Capital Development and Reform Committee successfully entered the third list, making the two co-operation with a sufficient condition.

    CITIC Group, CITIC Capital foreign investment agency, set up in 2002 in Hong Kong, CITIC International Financial Holdings Limited and CITIC Pacific Limited as the main shareholder of the original core business, including direct investment, real estate funds, structured finance, asset management and special items Investment, currently manages more than 2 billion U.S. dollars in assets. July 2009, China Investment Co., Ltd. decided to invest 20 billion dollar investment in CITIC Capital, holding 40%, also caused the industry attention.

    Shanghai Financial Industrial Fund, as approved by the State Council, one of the top ten industry fund in 2008, allowed the preparation, Shanghai International Group Co., Ltd. and China International Capital Corporation on such holdings, and is actively preparing the introduction of social security fund to invest in the third person. Shanghai Financial Industrial Fund, the total funding amount proposed 200 billion, down 8.0 billion fund-raising, but the year and a half later, no progress in the financing, CICC anti-withdrawal of the fund management. The Social Security Fund announced that bilateral cooperation has entered the due diligence process, the financial industry in Shanghai can not be said fund raising is a major breakthrough.

    Introduce foreign funds, according to sources, Blackstone, Lyon and other foreign funds also maintain an active and contact the Social Security Fund, which is now also actively preparing for foreign investment of RMB PE funds. IDG is such that the background of the Renminbi foreign funds, but earlier to the Development and Reform Committee. Currently, the Development and Reform Commission is preparing a new filing rules, which reached 500 million yuan to raise funds before accepting the record. The overseas direct investment in the Social Security Fund For PE, need the State Council, Ministry of Finance be approved.