The firm has joined with provincial authorities in Xi’an, in northern China, to create the fund, which will target companies in alternative energy, new materials, environmental protection, consumer products, retail and logistics. Another UK-based private equity firm, LDC, has backed the venture, contributing $20 million.
The Blue Oak China Venture Fund will invest in revenue-generating expansion, growth and pre-IPO stage businesses, mainly in western China. The fund has now closed and anticipates a life of seven years, with a four-year investment period in individual companies. It is structured to allow funds to be returned to Western investors.
The fund announcement follows Prime Minister David Cameron’s much-publicised visit to China last month and the opening of a $500 million investment fund, named the UK China Fund, created to encourage British SMEs to launch in the country.
In another investment deal in China, Rockley Group will expand its Rockley China Fund to $200 million following an agreement with the Shanxi Small and Medium Enterprise Investment Corporation (SSMEIC) to form a second venture in the country.
Rockley and SSMEIC, a technology venture fund owned by the Shanxi provincial government, have agreed to raise a $100 million fund, named Shanxi Zhongying Rockley, to develop the business opportunities in Shanxi, a coal mining region.
Last year, Rockley signed a similar agreement to raise a $100 million fund with the Shandong High-Tech Investment Corporation and the Shandong Academy of Sciences.
