Nexus Point reaches $200m first close on Greater China fund

The GP is targeting $750 million to pursue a mainland China, Hong Kong, and Taiwan mid-market buyout strategy, essentially occupying the $100 million deal space that has become less populated as various incumbents have increased their fund size and now concentrate on larger transactions. It will also consider investments in companies based outside the region that benefit from Asia’s growth.

The first close came in June, according to sources familiar with the situation, and Nexus Point has since completed its first transaction – an investment in the Burger King business in Taiwan.

Kung was a member of the original MBK team that spun out from The Carlyle Group in 2005. He resigned towards the end of last year, departing a couple of months before MBK closed its fourth North Asia buyout fund at $4.1 billion.

Kung serves as managing partner of Nexus Point, with Richard Wong and Min Li joining as partners and Raman Yiu as managing director and CFO. Wong was previously co-head of Asia M&A at Morgan Stanley, while Li led Bain Capital Private Equity’s healthcare sector efforts in China. Yiu was most recently CFO at Bain Capital and before that worked for Carlyle.

Between 2001 and 2008, five China-focused, US dollar-denominated funds raised in excess of $800 million while 140 or so achieved final closes of $600 million or below, according to AVCJ Research. Since 2009, there have been 29 funds of $800 million or more, including 12 of at least $1.5 billion. Approximately 60 more have been in the $300-800 million range, but over half are VC funds.

Earlier this year, CITIC Capital Partners closed the US dollar-denominated portion of its latest China fund at $1.57 billion, having raised $925 million last time around. CITIC Private Equity is currently looking to raise $2 billion for its third US dollar fund, compared to $1.3 billion for its second. They will join the likes of FountainVest Partners, Boyu Capital, and Primavera Capital in the $1.5 billion and above bracket.

CDH Investments, which closed its most recent flagship US dollar fund at $2.55 billion, responded to the mid-market gap by raising a dedicated vehicle of $800 million. The fund comprises two separate pools of capital: $300 million in US dollars and the equivalent of $500 million in renminbi.

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• Topics
• Greater China
• Fundraising
• Buyout
• China
• Nexus Point Partners
• MBK Partners
• GPs