Value Partners launches China education PE fund

Both Value Partners and China Education will make LP contributions and act as co-GPs, while seeking out additional LP support. Financial details have not been disclosed, although Value Partners has confirmed the vehicle aims to manage up to RMB5 billion ($753 million) in assets. Value Partners has established a PE subsidiary in Qianhai Special Economic Zone to co-manage the fund. 

The fund will primarily invest in private vocational and higher education segments in mainland China with a focus on control investments. China Education expects this effort to leverage strong demand for quality education as well as government incentives to develop human resources in various regions.

“Many private education operators have fallen into a development bottleneck after operating for more than a decade. They need capital and professional management for further growth,” Yu Guo, co-chairman of China Education, said in a statement. “By setting up the fund, we hope to provide a platform and win-win solutions to peers and partners for generating synergies and contributing to the development and growth of China’s private education sector.”

It extends a spate of private equity fundraising activity in China’s education space in recent months, including the launch of a $200 million fund focused on acquiring local preschools by Hong Kong-listed education investor China First Capital. The program, which is being co-managed by Singapore kindergarten operator MindChamps PreSchool, subsequently received a $50 million LP investment from Pavilion Capital, a PE unit of Temasek Holdings.

Increased private equity interest in education markets across Asia has been encouraged by perceptions that demand is outstripping supply for high-quality assets. However, this dynamic has also raised concerns of fast-rising valuations and potential difficulties in achieving targeted returns.  

Founded in 1993, Value Partners was the first asset manager to list on the Hong Kong Stock Exchange’s main board in 2007. In addition to its Hong Kong headquarters, the firm operates in Beijing, Shanghai, Shenzhen, Singapore, and London. Investment strategies cover equities, fixed income, multi-asset, quantitative investment services, and alternatives. The firm claimed $18.2 billion of assets under management as of May.

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• Topics
• Greater China
• Fundraising
• Consumer
• Buyout
• China
• Education
• M&A
• GPs