Cathay Capital raises $120m for China smart energy fund

The vehicle launched in March 2018 with a target of RMB1.5 billion. Total Carbon Neutrality Ventures, the VC unit of energy giant Total, and Hubei High Technology Investment Guiding Fund Management, a Chinese provincial government financial platform, came in as founding investors. Each agreed to contribute around RMB300 million.

In addition to ALIAD – which is making its first foray into China – the fund is backed by CMA CGM Group, a French container shipping company, and Wuhan Jingkai Industry Investment Fund Management. It will write checks of RMB30-100 million for companies involved in energy-related internet technology, energy efficiency, storage and distribution, new energy vehicles, renewable energy, and low carbon technologies.

A first investment has been made in Allsense Technology, an internet of things (IoT) solutions provider that specializes in the digitization of China’s thermal power industry. The company claims that its data collection tools can save money and reduce wastage by making real-time calculations intended to optimize production processes. Other backers include Shenzhen Green Pine Capital Partners, Future Capital, and Linear Venture, AVCJ Research’s records show.

Energy demand in China is expected to continue its rapid growth, driven by industrialization and urbanization. Although the country’s coal consumption is increasing in absolute terms, more emphasis is being placed on sustainable, decarbonized energy sources as a result of technological breakthroughs, rising environmental awareness, and policy support

“China’s energy industry is undergoing profound changes triggered by digitalization. Standing at this historical point in time, Cathay’s Smart Energy Fund will build and strengthen the connections between the energy sector’s superpowers and the smaller players developing technologies from the ground up,” Mingpo Cai, founder and chairman of Cathay Capital, said in a statement.

ALIAD was established in 2013 and invests in energy transition, healthcare, and digital technologies, often leveraging its own resources and expertise to support start-ups. Total Carbon Neutrality Ventures focuses on areas such as renewables, energy access and storage, new mobility, recycling, and IoT. Hubei High Technology Investment Guiding Fund Management is responsible for three government guidance funds with RMB5.8 billion in assets. It has also backed nearly 30 sub-funds.

The smart energy fund is Cathay Capital’s second renminbi-denominated industry vehicle, following a car technology fund that was launched in 2017. In May, the private equity firm closed its second middle-market fund, which invests in China, Europe and North America, at EUR800 million ($860 million). Meanwhile, Cathay Capital’s second innovation fund reached its EUR500 million target.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• Greater China
• Technology
• Growth
• Fundraising
• Cleantech
• Cathay Capital Private Equity
• China
• energy