NDE reaches $357m close on Fund II, raises hard cap

Backers include sovereign wealth funds, university endowments, and foundations across Asia, the Middle East, North America and Europe. The fund was established in 2015 with $107 million in initial commitments, including support from Germany’s DEG. A second close of $235 million came the following year. It is expected to reach a final close in the first half of 2018 and focus on cross-border businesses that leverage China’s One Belt One Road (OBOR) initiative.

“There was an influx of new LPs at the last minute asking for the extension, and our existing LPs have been very supportive because we’re seeing a significant pipeline of deals in Southeast Asia. There is a lot of appetite for our strategy,” a partner at NDE told AVCJ. “LPs are saying that One Belt One Road is becoming more real, and they like that we have exposure to a region that can grow with the Chinese market.”

Fund II aims to make about 12 investments at a rate of 2-3 deployments per year, taking a mix of minority and control stakes with an initial emphasis on Southeast Asian companies. The vehicle has made two investments to date, including a food and beverage supplier, and a casual dining and fast food service operator. NDE has stressed the growth potential in Chinese demand for imported products, including Southeast Asian cuisine.

“One Belt One Road has led to increases in spending, labor force hiring, and more GDP per capita at the local economy level,” the NDE partner added. “There is a growing realization that the fundamentals of Asia, macro-wise, are much more stable. With new infrastructure, it is more cost-effective supply-chain wise for us to get products to Chinese consumers, and Chinese companies are investing heavily in linking up with Southeast Asia.”

NDE specializes in filling soft infrastructure gaps in China-connected supply chains by investing in growth-stage companies and working with Chinese state-owned enterprises. The strategy includes a focus on consumer sectors that are being reshaped by increased appetite for OBOR-related M&A. AVCJ understands that two new investments in this space are currently in the negotiation phase. 

The firm’s first fund closed at $50 million in 2007 and was supported by $150 million in co-investment. NDE claims to have exited six of seven companies, including China’s Tairui Pharmaceutical, a medical technology developer focused on veterinary segments. 

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• Topics
• Greater China
• Southeast Asia
• Growth
• Fundraising
• China
• NDE Capital
• Logistics
• Consumer
• One Belt One Road