FountainVest scoops top AVCJ China awards, targets more buyouts

In a challenging fundraising environment, FountainVest closed its second fund over target at $1.35 billion after just seven months in the market. The PE firm has also been at the forefront of the wave of China take-private deals, playing a key role in the $3.7 billion club deal for China Focus Media and taking the lead as the sole PE backer of a smaller privatization of LJ International.

"We are proud to be one of the lead investors and an active participant the privatization of Focus Media," said Yancen Lu, a director at FountainVest, who collected the awards.

He added that the PE firm will continue to back quality entrepreneurs with growth capital but also look for more buyout opportunities. With this in mind, FountainVest has added to its investment and operations teams.

"The proportion of portfolio companies controlled by us is increasing," Lu said. "Buyout deals require different skill sets and we are accumulating these. I believe that we are well positioned to do more control deals in the future. This is what makes us different from a lot of other Chinese PE fund managers."

MSPEA's Sun won the PE Professional of the Year award in recognition of a busy year for his team in which one China control deal has been completed and a further two are pending.

The captive PE unit bought Hi-24, a leading Beijing convenience store chain in a carve-out from the company's parent last November. The other two deals are both take-privates of US-listed Chinese companies - dairy producer Feihe International and crop nutrients specialist Yongye International. The former has already won board approval.

Private Equity Deal of the Year went to one of the largest ever transactions involving a Chinese company as Alibaba Group repurchased half of a 40% stake in itself held by Yahoo for $7.6 billion last September. The private equity funding in the deal was led by China Investment Corp, with Boyu Capital, CITIC Capital and CDB Capital coming in as new investors. Existing PE investors in Alibaba also increased their holdings.

The VC Deal of the Year and VC Professional of the Year awards share a common thread - Chinese super angel Lei Jun, who now has his own VC firm, Shunwei Capital Partners.

Lei created mobile phone company Xiaomi with seed capital from Morningside Technologies and Qiming Venture Partners. It has since gone from strength to the strength and the most recent round of funding, completed last June, valued the business at $4 billion. DST Advisors led the $216 million round, with Government of Singapore Investment Corp, Temasek Holdings, Qualcomm Ventures, Shunwei, IDG Capital Partners, Morningside and Qiming.

Lei took the VC professional award not just for his work on Xiaomi but also for YY, a social networking platform that was one of just two Chinese companies to go public in the US last year.

Other awards presented included Renminbi Fundraising of the Year, which went to CDH Investments for Tianjin CDH Equity Investment Fund II, and Exit of the Year, which went to The Carlyle Group for China Pacific Insurance.

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• Topics
• Performance
• Greater China
• AVCJ Awards
• China