CHINESE sovereign wealth fund China Investment Corporation (CIC), BNP Paribas and investment management firm Eurazeo have held a first close of their France-China Cooperation Fund at 400 million euros (US$451.42 million).
The setting up of the fund dates back to last year, when a letter of intent was signed in the presence of Chinese President Xi Jinping and French President Emmanuel Macron. The first closing was announced on June 3.
The initial 400 million euros has been contributed by CIC, BNP Paribas and Eurazeo, and additional funds will now be raised from third parties, with an eventual target size of 1 billion to 1.5 billion euros. The initial partners may commit up to an additional 250 million euros to the fund, within a limit of 25% for each of BNP Paribas and CIC.
CIC and BNP Paribas chose Eurazeo to manage the fund, as well as selecting and managing the investments.
Eurazeo is a global investment company with an assets under management figure of 18.8 billion euros, including 12.5 billion euros from third parties. It has invested in over 300 companies, via private equity, venture capital, real estate, private debt, and fund of funds. Eurazeo is listed on Euronext Paris, and has offices in Paris, Shanghai, Seoul, New York, Sao Paulo, London, Luxembourg, Frankfurt, Berlin, and Madrid.
The fund will invest in French and continental European companies that are aiming to grow in China. It will seek investment opportunities alongside Eurazeo’s middle market buyout strategies, Eurazeo Capital and Eurazeo PME.
According to Eurazeo, target companies are expected to be in sectors with opportunities in China and where the firm has a track record, including advanced industrials, business services, consumer goods and services, healthcare, and digital technology.
The partnership will aim to draw on the different strengths of the three initial investors. CIC can facilitate the fund’s investee companies entry into and development within China, while BNP Paribas has a strong local presence and networks in France and across the EU.