CMIG bets big on Belt and Road drive

By LUO WEITENG in Hong Kong | China Daily | Updated: 2017-05-04 08:07

A consortium of financial institutions in Asia-led by China Minsheng Investment Group-said it is betting big on the Belt and Road Initiative and will spend many billions of dollars to get onboard the investment boom.

CMIG, the country's biggest privately owned investment conglomerate, said it had teamed up with its regional peers to set up a fund worth $10-$15 billion in Hong Kong last week, in their quest for first-mover advantage in the Belt and Road push.

The strategic partners comprise a long list of well-established names across the region.

They include Zhongtai International in the Chinese mainland, Hong Kong-based Sun Hung Kai, AMTD Group and BlackPine, Japan-based Orix Corp, South Korea-based Mirae Asset Global Investments and IndoChina Capital from Southeast Asia.

"Such a super partnership, led by CMIG, is looking to tap the potentially huge opportunities coming from the massive funding gap in Belt and Road countries and regions," said Calvin Choi, senior assistant president of CMIG.

"Partners would certainly be better off investing in groups rather than going it alone," he said.

"By reducing risks and improving fundraising efficiency, eventually this helps partners find out promising projects that best fit in with their investment expertise."

Typically, financial technology, high-tech and other emerging industries are where the new fund would keep its eyes trained, Choi noted.

Though he didn't reveal a timeline for the first round of fundraising, Choi said they would "go with the tides".

The new fund is based in Hong Kong, a choice that highlights the financial hub's edge as the "super connector" and gateway to the massive mainland market, he added.

Lawrence Chu, founder and managing partner of BlackPine Private Equity Partners, said the Belt and Road Initiative had what it takes to be a long-term and stable investment channel. E-commerce and online payments in Southeast Asia, for instance, stood out in a land of opportunities that they could not afford to miss, Chu noted.

Choi confirmed the Southeast Asia is where the new fund is looking, with the North American market coming next.

The fund will be working under the mechanism of Asia Institutional Investor Alliance, an organization established by CMIG in October last year in partnership with China-ASEAN Investment Corporation Fund, JP Morgan and UBS.

Founded in Shanghai in 2014 with a registered capital of 50 billion yuan ($7.3 billion), CMIG comprises 59 private enterprises, including Giant Interactive Group backed by billionaire Shi Yuzhu, Suning Commerce Group and China Oceanwide Holdings Group.

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