CITIC closes second Japan fund

CITIC Capital is jointly owned by China's sovereign wealth fund China Investment Corporation (CIC), and CITIC Group, the largest Chinese conglomerate, through its CITIC International Financial Holdings Limited and CITIC Pacific Limited subsidiaries.

The Japan investment team was formed in 2004 after launching a maiden Japan fund for JPY17 billion ($155.2 million at historical rates). The original fund's LPs were made up of domestic institutional investors.

Several industry sources told AVCJ that CITIC Partners is one of the few Japan-focused funds which has support from CIC. The Chinese SWF has made commitments to CCJP II. CITIC also has a strong pipeline within China that strengthens mutual synergies between the group's Chinese and Japanese investment portfolios. A PE source said that in spite of recent events, "Japan's economy will continue to be stimulated by the economic giant that is China, thus it is important to see the cross-cultural and cross-border business opportunities for Japanese companies in China."

Hironobu Nakano, head of CITIC Capital Partners' Japan operations said in a statement, "Over the past seven years we have gained unique experience in helping Japanese companies to successfully expand into China. Our team, based primarily in Tokyo and Shanghai, looks forward to finding new opportunities to help Japanese companies maximize their potential through international expansion."

Yichen Zhang, CEO of CITIC Capital Partners, added that the firm believes there is tremendous investment opportunity to assist outstanding Japanese companies in international expansion, particularly into China.

CITIC Capital Japan Partners II, L.P. has already made two investments. One is a 63.2% stake in Higashiyama Film Co. Ltd., a Japanese company involved in the design and production of coated films for use in applications such as touch panels, mobile phones, PDAs and home appliances. The other is a majority stake in Tri-Wall, a Tokyo-based heavy-duty corrugated fiberboard packaging company.

CCJPII targets buyouts of middle-market Japanese companies, particularly those with substantial operations or growth potential in China. The firm's tactics in terms of investing in related China and Japan-based companies is particularly apropos to Higashiyama Film, which sees more than 40% of its sales from China, where the company has two subsidiaries located in Shanghai.

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• Topics
• North Asia
• Fundraising
• CITIC Capital Partners