CDIB Capital invests $45m in China's Best Logistics

This is part of a larger funding round, which was expected to be worth up to $700 million. The International Finance Corporation (IFC) said in January that it would contribute up to $30 million. The company has previously received several rounds of funding from financial and strategic investors and an unspecified number of these groups also participated in the latest financing.

Best Logistics was founded by Johnny Chou, formerly co-president of Google China, in 2007. The Hangzhou-based company's core businesses include providing express, less-than-truckload (LTL) freight and supply chain management services focused on the e-commerce industry. It also offers financing for supply chain vendors, cross-border logistics and last-mile services to improve the efficiency of logistics services.

As of January, the company operated 400 distribution centers and one million square meters of warehouses in China, three warehouses in the US and one in Germany. It claimed to handle about six million parcels every day, while its freight service unit - Best Freight - delivers 6,400 tons of parcels per day. Best Logistics provides third-party logistics services to approximately 200 corporate clients.

According to AVCJ Research, the company received an undisclosed amount of funding from Walden International and CDH Investments in 2010. Alibaba Group, The Hina Group and Walden International acquired a minority stake in the firm for $20 million in 2011. Other backers include Foxconn Technologies, China Renaissance Capital Investments, IDG Capital Partners and Goldman Sachs.

"In a short period of time, Best Logistics has established itself as an industry leader at the forefront of logistics technology," said Lionel de Saint-Exupery, president and CEO of CDIB Capital, in a statement. "We've been impressed by the company's ability to provide complex turn-key logistic solutions across the country and beyond."

He expects to see continued growth as corporates outsource non-core functions such as logistics. Spurred by rising demand, particularly in e-commerce, and a lack of high-quality supply, private capital is flooding into China's logistics sector from a variety of sources. Warehousing providers and third-party logistics players are popular targets.

CDIB Capital, the PE arm of Taiwan's China Development Financial (CDF), was set up in 2006 using balance sheet money. The firm closed its debut Asia private equity fund - with commitments from fund-of-funds, family offices, sovereign wealth funds, insurers and corporations - last year at $405 million.

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• Topics
• Greater China
• Expansion
• Support services
• CDIB Capital
• Logistics
• Growth capital
• China
• IFC