L Capital plans $1b Asia fund

According to managing partner Ravi Thakran, competition from Western brands means Chinese retailers need to protect themselves by raising funding from sources such as private equity. "The reason we want to do a larger fund next time is primarily because opportunities in the segment are huge, and we see larger and larger companies coming to us," he told Reuters.

Brands such as Abercrombie & Fitch and Gap are expected to expand rapidly into China's second- and third-tier cities.

L Capital's current Asia fund, which closed at $650 million, targets consumer investment opportunities in China, India and Southeast Asian markets such as Indonesia, Malaysia and Thailand. Launched last year, the fund buys minority stakes in non-LVMH companies related to retail, F&B and lifestyle.

Earlier this week, the fund participated in a $200 million investment in Trendy International Group, a Chinese casual-wear company. It purchased a 10% stake in the Guangzhou-based chain, which owns hundreds of stores and franchises for its four brands.

That transaction came just weeks after L Capital increased its holding in Xinhe Fashion to become the company's second-largest equity stakeholder. The funding of the Xiamen-based fashion company was the private equity unit's first mainland investment.

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• Topics
• Venture
• Consumer
• Greater China
• China
• Consumer
• Fundraising