Asia Awards: AVCJ Special Achievement – Shangzhi Wu

Investments in the first fund included Shanshui Cement, China Mengniu Dairy and Li Ning, each of which ended up going public in Hong Kong. CDH seized on this momentum and has never looked back. The firm now has about $8 billion in capital under management across PE, VC, real estate, listed equities and high-yield mezzanine.

In recognition of this achievement, Shangzhi Wu, chairman and managing partner of CDH, won the AVCJ Special Achievement Award.

Wu was unable to attend the ceremony personally, so Stuart Schonberger (pictured), managing director at CDH, collected the award on his behalf. "I think it is quite representative of the firm and Dr. Wu himself, how low key and out of the limelight all of my partners like to be," Schonberger said. "But we truly are a Chinese firm and under Dr. Wu's leadership we strive to be a world-class institution."

Schonberger also stressed that CDH's strength is reflected in its stability, with the six original partners, who started working together at CICC in 1995, still in place. However, in other respects, the firm has moved with the times.

Speaking to AVCJ earlier this year, Wu contrasted the early years spent restructuring companies into red-chip offshore holding structures with the post-2007 era in which offshore restructuring became more difficult.

"The A-share market became the main route for IPOs and there are regulations defining how long it takes to restructure a company into a joint-stock company," he said. "If you are foreign-invested it takes even longer. There is the queue for IPOs and then the lock-up could be 1-3 years. This transition has made the pace of exits much slower, so IRRs come down."

With larger funds and bigger ticket deals - CDH's average commitment is now $100 million and it is raising its fifth US dollar-denominated fund, with a target of $2 billion, and last year closed its second renminbi fund at RMB8 billion ($1.3 billion) - has come more manpower. The firm now has close to 50 investment professionals and a seven-strong operating team.

As for diversification, it started out almost by accident. First, LPs wanted clarity on the asset class because Fund I covered the full gamut from venture capital to buyouts, and so the VC business was spun out. Then, one LP wanted to set up a listed equities platform but couldn't find the right people, so CDH did it instead.

Now, though, exposure to multiple asset classes is seen as integral to keeping CDH going for another 10 years and more. "Diversification is important for long-term stability," Wu said.

(The award was collected by Stuart Schonberger, pictured, managing director at CDH Investments.)

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• Greater China
• Expansion
• Exits
• People
• CDH Investments Management
• China
• AVCJ Awards