Hosen targets $400m for China food and agri fund

The private equity firm, which counts domestic agribusiness conglomerate New Hope Group as an anchor investor in its funds, started out in 2010 in the renminbi space, closing its first fund at $177 million. It then raised a $127 million US dollar vehicle in 2012, securing commitments from a sovereign wealth fund as well as from several strategic investors and global asset managers.

Realized returns across both funds are around 3x , according to a source familiar with the situation.

The firm invests all the way along the food value chain, from agricultural inputs through processing and manufacturing, logistics and retail to consumer goods. Private equity investors are increasingly looking at opportunities that leverage demand from China's expanding middle class for food that meets international quality and safety standards.

In 2013, Hosen acquired Kilcoy Pastoral, one of Australia's leading premium grain-fed beef processors and exporters, with a view to ramping up the business in China. It then bolted-on US-based processor Ruprecht as a technology upgrade. Further overseas and domestic acquisitions are under consideration in order to create a high-quality protein supply.

A portion of both US dollar funds is allocated to personal care and healthcare, which is also driven by both consumption upgrade and industry upgrade. The GP has originated investments including a manufacturer of endoscope robot systems that enter the body via edible capsules.

Hosen has a team of 22 investment professionals located in offices in Beijing, Shanghai, Chengdu and Shenzhen.

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• Topics
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• Greater China
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• China
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• Hosen Capital
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