CDH Investments (CDH, 鼎晖投资基金管理公司) is a major Chinese alternative asset management firm based in

Beijing Beijing, Chinese postal romanization, previously romanized as Peking, is the capital city of China. With more than 22 million residents, it is the world's List of national capitals by population, most populous national capital city as well as ...

China China, officially the People's Republic of China (PRC), is a country in East Asia. With population of China, a population exceeding 1.4 billion, it is the list of countries by population (United Nations), second-most populous country after ...

. It specializes in

private equity Private equity (PE) is stock in a private company that does not offer stock to the general public; instead it is offered to specialized investment funds and limited partnerships that take an active role in the management and structuring of the co ...

venture capital Venture capital (VC) is a form of private equity financing provided by firms or funds to start-up company, startup, early-stage, and emerging companies, that have been deemed to have high growth potential or that have demonstrated high growth in ...

and credit products. CDH invests across a range of sectors and regions. As of March 2015, CDH manages over RMB 100 billion of investor capital across its various investment platforms. Founded in 2002, CDH is a diversified alternative asset manager covering private equity, venture capital,

mezzanine A mezzanine (; or in Italian, a ''mezzanino'') is an intermediate floor in a building which is partly open to the double-height ceilinged floor below, or which does not extend over the whole floorspace of the building, a loft with non-sloped ...

, real estate, and

wealth management Wealth management (WM) or wealth management advisory (WMA) is an investment advisory service that provides financial management and wealth advisory services to a wide array of clients ranging from affluent to high-net-worth (HNW) and ultra-hi ...

. Its investor base includes

sovereign wealth fund A sovereign wealth fund (SWF), or sovereign investment fund, is a state-owned investment fund that invests in real and financial assets such as stocks, Bond (finance), bonds, real estate, precious metals, or in alternative investments such as ...

pension fund A pension fund, also known as a superannuation fund in some countries, is any program, fund, or scheme which provides pension, retirement income. The U.S. Government's Social Security Trust Fund, which oversees $2.57 trillion in assets, is the ...

insurers Insurance is a means of protection from financial loss in which, in exchange for a fee, a party agrees to compensate another party in the event of a certain loss, damage, or injury. It is a form of risk management, primarily used to protect ...

, endowments,

family office A family office is a privately held company that handles investment management and wealth management for a wealthy family, generally one with at least $50–100 million in investable assets, with the goal being to effectively grow and transfer ...

s and

fund of funds A "fund of funds" (FOF) is an investment strategy of holding a portfolio of other investment funds rather than investing directly in stocks, bonds or other securities. This type of investing is often referred to as multi-manager investment. A f ...

from China, North & South America,

Europe Europe is a continent located entirely in the Northern Hemisphere and mostly in the Eastern Hemisphere. It is bordered by the Arctic Ocean to the north, the Atlantic Ocean to the west, the Mediterranean Sea to the south, and Asia to the east ...

Middle East The Middle East (term originally coined in English language) is a geopolitical region encompassing the Arabian Peninsula, the Levant, Turkey, Egypt, Iran, and Iraq. The term came into widespread usage by the United Kingdom and western Eur ...

Australia Australia, officially the Commonwealth of Australia, is a country comprising mainland Australia, the mainland of the Australia (continent), Australian continent, the island of Tasmania and list of islands of Australia, numerous smaller isl ...

and

Asia Asia ( , ) is the largest continent in the world by both land area and population. It covers an area of more than 44 million square kilometres, about 30% of Earth's total land area and 8% of Earth's total surface area. The continent, which ...

. CDH is headquartered at Fortune Financial Center, 5 Dongsanhuan Central Road, Beijing, China, with additional offices in

Shanghai Shanghai, Shanghainese: , Standard Chinese pronunciation: is a direct-administered municipality and the most populous urban area in China. The city is located on the Chinese shoreline on the southern estuary of the Yangtze River, with the ...

Shenzhen Shenzhen is a prefecture-level city in the province of Guangdong, China. A Special economic zones of China, special economic zone, it is located on the east bank of the Pearl River (China), Pearl River estuary on the central coast of Guangdong ...

Hong Kong Hong Kong)., Legally Hong Kong, China in international treaties and organizations. is a special administrative region of China. With 7.5 million residents in a territory, Hong Kong is the fourth most densely populated region in the wor ...

Singapore Singapore, officially the Republic of Singapore, is an island country and city-state in Southeast Asia. The country's territory comprises one main island, 63 satellite islands and islets, and one outlying islet. It is about one degree ...

, and

Jakarta Jakarta (; , Betawi language, Betawi: ''Jakartè''), officially the Special Capital Region of Jakarta (; ''DKI Jakarta'') and formerly known as Batavia, Dutch East Indies, Batavia until 1949, is the capital and largest city of Indonesia and ...

History

In 1992, Wu Shangzhi, then Senior Investment Officer at the

World Bank Group The World Bank Group (WBG) is a family of five international organizations that make leveraged loans to developing countries. It is the largest and best-known development bank in the world and an observer at the United Nations Development Group ...

's Direct Investment Division, decided to establish an investment firm in China. He approached

GIC GIC may refer to: Education * Ghana Insurance College, in Accra, Ghana * Government Intermediate College, a type of school in India * Grait International College in Nigeria * Gyosei International College in the U.K., defunct Finance * General ...

with a fund raising proposal. Instead of considering an equity commitment, GIC suggested Wu to join China International Capital Corporation, an investment bank that GIC was involved in the preparatory work related to the firm's establishment at that point. Wu led the direct investment business at China International Capital Corporation until it was split off by the firm in 2001, when

China Securities Regulatory Commission The China Securities Regulatory Commission (CSRC) is a government agency directly under the State Council of the People's Republic of China. It is the main regulator of the securities industry in China. History Indicative of the role of the C ...

prohibited investment bank from doing private equity investment. In 2002, CDH was established with six founding partners including Wu Shangzhi and Jiao Zhen, who had worked together at China International Capital Corporation's Direct Investment Division since 1995. Other shareholders include

, China National Investment & Guaranty Co Ltd, and Capital Z Partners. As of 2014, CDH had retained all six founding partners within the firm, despite famously losing its head of venture capital, Wang Gongquan, who ran away with his mistress. In 2003, CDH raised $102 million for its first standalone

fund Fund may refer to: * Funding is the act of providing resources, usually in form of money, or other values such as effort or time, for a project, a person, a business, or any other private or public institution ** The process of soliciting and gathe ...

. Deals that year included stakes in sportswear company

Li-Ning Li-Ning Company Limited is a Chinese sportswear and sports equipment company founded by former Olympic gymnast Li Ning. The company endorses a number of international athletes and teams worldwide in pursuit of the North American market(s). His ...

, display advertising firm Focus Media and

Mengniu Dairy Inner Mongolia Mengniu Dairy (Group) Limited by Share Ltd. () is a Chinese manufacturing and distribution company of dairy products and ice cream. The company is headquartered in Hohhot, Inner Mongolia and manufactures dairy products under the '' ...

. According to ''

Reuters Reuters ( ) is a news agency owned by Thomson Reuters. It employs around 2,500 journalists and 600 photojournalists in about 200 locations worldwide writing in 16 languages. Reuters is one of the largest news agencies in the world. The agency ...

'', this first fund returned approximately 3.5 times its investors' money. In 2006, CDH and

Goldman Sachs The Goldman Sachs Group, Inc. ( ) is an American multinational investment bank and financial services company. Founded in 1869, Goldman Sachs is headquartered in Lower Manhattan in New York City, with regional headquarters in many internationa ...

invested $256 million in a controlling stake in a struggling meat producer, then known as Shuanghui Group, along with

Temasek Temasek ( or , also spelt Temasik or Tumasik) is an early recorded name of a settlement on the site of modern Singapore. The name appears in early Malay and Javanese literature, and it is also recorded in Yuan and Ming Chinese documents ...

and New Horizon Capital. That buyout deal, one of the first of its kind in China, sparked controversy as opponents claimed the country was selling assets too cheaply to foreign investors. Goldman sold half its stake back to CDH in 2009 for five times what it originally paid. CDH institutional investors have included

California Public Employees' Retirement System The California Public Employees' Retirement System (CalPERS) is an agency in the California executive branch that "manages pension and health benefits for more than 1.5 million California public employees, retirees, and their families".CalPERSFa ...

, the Oregon State Treasury, the Texas County & District Retirement System, and

Canada Pension Plan Investment Board The Canada Pension Plan Investment Board (CPPIB; ), operating as CPP Investments (), is a Canadian Crown corporation established by way of the 1997 ''Canada Pension Plan Investment Board Act'' to oversee and invest the funds contributed to and h ...

. As of 2014, 75 percent of CDH's private equity funds came from international investors. That year, with a target cap at $2 billion, CDH's fifth USD PE fund was closed at a hard cap of $2.5 billion due to over-subscription.

Businesses and affiliates

CDH's family of funds includes private equity, venture capital, real estate, mezzanine and credit products.

Private equity

CDH manages five funds denominated in United States Dollars funds and two funds denominated in Chinese Yuan (RMB), with cumulative assets under management in excess of US$15 billion.

Venture capital

CDH established its venture capital business in 2006 and currently manages more than US$1 billion of assets through several USD and RMB funds. The investment focus covers telecom, media,

technology Technology is the application of Conceptual model, conceptual knowledge to achieve practical goals, especially in a reproducible way. The word ''technology'' can also mean the products resulting from such efforts, including both tangible too ...

, and

health care Health care, or healthcare, is the improvement or maintenance of health via the preventive healthcare, prevention, diagnosis, therapy, treatment, wikt:amelioration, amelioration or cure of disease, illness, injury, and other disability, physic ...

sectors.

Real estate

CDH's real estate business was set up in 2009 and currently manages more than US$700 million of assets through several USD and RMB funds, focusing on development projects with a sector mix of approximately 50/50 residential and commercial properties. CDH has invested in 13 real estate projects in 12 cities across China, as of June 30, 2014.

Credit

In 2011, CDH launched its mezzanine and credit business and currently manages more than US$640 million of assets through several USD and RMB funds, with a focus on high-yield debt solutions to finance real estate, energy resources and equity

mergers and acquisitions Mergers and acquisitions (M&A) are business transactions in which the ownership of a company, business organization, or one of their operating units is transferred to or consolidated with another entity. They may happen through direct absorpt ...

Public equity

Cephei Capital was founded in 2006 with the support from CDH. Cephei focuses on investing in Chinese companies in the secondary market. Cephei now manages separate accounts for a number of Qualified Foreign Institutional Investors (QFII) in the China A-share market. At the same time, Cephei also manages a variety of long-biased public equity funds and collectively manages more than US$1.5 billion in assets.

Investments

CDH invests across industries including

information technology Information technology (IT) is a set of related fields within information and communications technology (ICT), that encompass computer systems, software, programming languages, data processing, data and information processing, and storage. Inf ...

, media, modern services, innovative

engineering technology An engineering technologist is a professional trained in certain aspects of development and implementation of a respective area of technology. An education in engineering technology concentrates more on application and less on theory than ...

telecommunication Telecommunication, often used in its plural form or abbreviated as telecom, is the transmission of information over a distance using electronic means, typically through cables, radio waves, or other communication technologies. These means of ...

technology and services, new media, industrial manufacturing,

education Education is the transmission of knowledge and skills and the development of character traits. Formal education occurs within a structured institutional framework, such as public schools, following a curriculum. Non-formal education als ...

finance Finance refers to monetary resources and to the study and Academic discipline, discipline of money, currency, assets and Liability (financial accounting), liabilities. As a subject of study, is a field of Business administration, Business Admin ...

, fast growing high-tech and services, energy,

clean technology Clean technology, also called cleantech or climate tech, is any process, product, or service that reduces negative environmental impacts through significant Efficient energy use, energy efficiency improvements, the sustainable use of resources, o ...

healthcare Health care, or healthcare, is the improvement or maintenance of health via the preventive healthcare, prevention, diagnosis, therapy, treatment, wikt:amelioration, amelioration or cure of disease, illness, injury, and other disability, physic ...

, medical, retail,

consumer product A final good or consumer good is a final product ready for sale that is used by the consumer to satisfy current wants or needs, unlike an intermediate good, which is used to produce other goods. A microwave oven or a bicycle is a final good. Whe ...

and services, and

agricultural industry Agriculture encompasses crop and livestock production, aquaculture, and forestry for food and non-food products. Agriculture was a key factor in the rise of sedentary human civilization, whereby farming of domesticated species created food ...

. Since inception, CDH has invested in or acquired hundreds of companies including Hang Seng Electronics,

, Focus Media, Yurun Food, Yongle,

China Merchants Bank China Merchants Bank (CMB) () is a Chinese bank headquartered in Futian District, Shenzhen, Guangdong, China. Founded in 1987, it is the first share-holding commercial bank wholly owned by corporate legal entities in China. CMB listed on the Sha ...

Belle International Belle International Holdings Limited is a women's shoe retailer in China, with 22% of the domestic market share. It is engaged in the manufacturing, distribution, and retail sales of footwear products. As of its IPO in May 2007, the company had ...

, LDK, AirMedia, CNInsure,

Joyoung Joyoung Co., Ltd. () is a Chinese manufacturer of home-use soybean milk machines,Modern Dairy, Hanting Hotel, Kanghui Medical, TSL Jewelry, M&G Stationery, Xueda Education,

Qihoo 360 Qihoo 360 (; approximate pronunciation CHEE-hoo), full name 360 Security Technology Inc., is a Chinese internet security company that has developed the antivirus software programs 360 Safeguard and 360 Mobile Safe, the Web browser 360 Secure Bro ...

, Midea, WH Group, Luye Pharma,

Nanfu Battery Nanfu Battery (), full name Fujian Nanping Nanfu Battery, Co., Ltd., is a Chinese alkaline battery manufacturer and supplier. Nanfu Battery is headquartered in Nanping, Fujian province, China. Nanfu Battery holds the number one position in China's ...

, and Baroque Japan Limited.

References

External links

* {{Official website, http://www.cdhfund.com/ Companies based in Beijing Alternative investment management companies