Russia keen to double size of joint PE fund with China
China Investment Corporation (CIC) and Russian Direct Investment Fund (RDIF) could double their contribution to their joint fund to $2 billion apiece and expand its investment projects this year.
Six to seven new deals will be completed in 2013, China Daily reported, citing RDIF CEO Kirill Dmitriev. The fund made its first investment of $200 million for minority stake in Russia Forest Products, the country's second-largest forestry company.
The fund is looking for investment opportunities in other sectors including agriculture, logistics and machinery in China and Russia, said Dmitriev. More investors from Australia and other nations might be introduced as LPs to share the investment risks, while CIC and RDIF will be decision makers.
Last year, Russia and China confirmed plans for a joint $4 billion investment fund, backed by initial contributions of $1 billion apiece from RDIF and CIC. The remaining $2 billion is expected to be generated from other Chinese institutional investors. Up to 70% of the capital will be invested in projects across Russia and other CIC countries, while the remaining 30% will back Chinese businesses with Russian involvement.
A joint venture company has been set up to run the fund, with RDIF and CIC controlling 60% and 40%, respectively.
Two months ago, CIC participated as a cornerstone investor in Moscow Exchange's $500 million IPO. The deal represents another collaborative effort between the Chinese sovereign wealth fund and its Russian counterpart.
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