IDG Capital, China Oceanwide to buy International Data Group

China Oceanwide will become controlling shareholder of IDG’s operating businesses, which cover technology-related media, data and marketing services. Terms of the deal – which is expected to close in the first quarter of 2017, having already received clearance from the Committee on Foreign Investment in the US (CFIUS) – were not disclosed. Previous reports put the valuation at $500 million to $1 billion.

Founded in 1964, IDG comprises IDG Communications, owner of brands such as CIO, Computerworld, PCWorld and Macworld and related marketing services, and International Data Corporation (IDC), a provider of market intelligence, advisory services and events for the IT, telecom and consumer technology partners, with more than 1,100 analysts worldwide.

IDG Ventures was established in the 1990s as a global network of venture capital funds, targeting investment opportunities in the US, China, India, Vietnam and Korea, leveraging other resources in the IDG network. It has more than $3 billion under management and has invested in over 220 companies in the last 15 years. Funds managed by the different IDG Ventures entities have IDG as one of multiple LPs.

China venture investments began in 1993 led by Hugo Shong (pictured), who formed the local unit with Pat McGovern, co-founder of IDG. McGovern passed away in 2014. More than 500 investments have been made to date, as well as over 150 exits. The historical portfolio includes Baidu, Tencent Holdings, Qihoo 360, Ctrip, Xiaomi, Meitu and CreditEase.

In 2005, IDG Capital and Accel Partners launched a series of China funds. In 2009, the firm changed its name from IDG Ventures China to IDG Capital Partners to reflect its focus on growth as well as VC deals. It subsequently became IDG Capital.

The most recent venture fund closed at $586 million in 2014, while the latest growth fund, raised in conjunction with Breyer Capital, closed at $1 billion in 2016. IDG Capital manages 10 funds in total, covering US dollars and renminbi. Last year, the firm also teamed up with China Everbright to launch a fund that targets M&A and restructuring opportunities.

“IDG’s culture is at the core of its success, and its strength has always been rooted in the talent and dedication of its people. Our focus going forward will be on investing in the company and its people for growth over the long term, as we carry the flag of Pat’s legacy for many years to come,” said Shong, now founding general partner of IDG Capital, in a statement.

China Oceanwide was founded in 1985 by Zhiqiang Lu. Its assets encompass financial services, real estate, media and technology. It is a significant investor in China Minsheng Bank and has controlling interests in several Shenzhen or Hong Kong-listed assets and private assets, including several Minsheng-related entities.

IDG will continue to be headquartered in Boston, with Kirk Campbell and Michael Friedenberg, CEOs of IDC and IDG Communications, respectively, set to stay in their roles.

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• Topics
• Greater China
• North America
• Buyouts
• Media
• China
• USA
• M&A
• IDG Capital Partners