China’s Loyal Valley closes second US dollar fund at $465m

Loyal Valley contributed $25 million. The GP closed its first US dollar-denominated fund at $390 million last year following a renminbi-to-US dollar restructuring backed by NewQuest Capital Partners. Its first vehicle, an evergreen renminbi fund set up in 2015, currently claims $750 million in assets under management.

“We believe that our truly local, grassroots team and strong entrepreneurial culture focused on continuous improvement will continue to deliver superior performance for our investors,” said Andy Lin, founding partner at Loyal Valley.

Investors in the latest US dollar fund include Singapore’s GIC Private, which also supported the first US dollar fund alongside NewQuest and TR Capital. That transaction saw the rollover of three renminbi assets including ride-hailing app Didi Chuxing, video-sharing service Bilibili, and drug developer Junshi Biosciences, into a new vehicle.

The new US dollar fund will continue the strategy of its predecessor with a strong focus on new consumer and healthcare, according to Linda Cai, a partner and COO of Loyal Valley. Investments will target two main demographics: people born since the 1990s and those over 60 years old.

“Altogether, they are a 500-600 million population in China,” Cai said. “They have the strongest demand but not enough supply in areas of media, entertainment, lifestyle upgrade and education.”

Cai told AVCJ that around one-third of the investment team looks at consumer areas such as the upgrade of domestic brands, while one-third focuses on healthcare, including cancer and biopharma companies targeting the aging population. The rest of the team focuses on specialty industrials or financial services.

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• Topics
• Greater China
• Technology
• Consumer
• Healthcare
• Fundraising
• Venture
• China
• Loyal Valley Capital
• GIC Private