China’s Sailing Capital has reportedly launched an RMB5bn ($821m) buyout fund with subsidiary Shanghai Sailing Industrial Capital to make cross-border deals.
The fund could eventually rise to more than RMB20bn through bond issuance, loans and equity investments according to AVCJ, which picked up the news from China Securities Times.
It reported Sailing Capital CEO Xiaodong Liu as saying an agreement had been signed with the Shanghai Stock Exchange to support listed companies to acquire overseas targets and incorporate these businesses into the domestic listed entity.
Sailing Capital currently manages China’s largest yuan-denominated international fund, which was set up by the Shanghai government last year.
The RMB50bn-targeting vehicle is expected to leverage more than RMB150bn by setting up affiliated vehicles and issuing bonds.
The fund will offer a platform for Chinese companies looking to venture overseas for growth opportunities, and will also prioritise the use of local currency in pricing, transaction and settling of projects in a bid to reduce dependence on the US dollar.
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