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Reuters Shanghai- Ten new China-focused private equity funds raised $12 billion (six billion pounds) in the second quarter, but poor market conditions have forced foreign funds to delay exits of their investments through IPOs and secondary offerings, consultant firm Zero2IPO said on Thursday.
The second-quarter figure is up 107.6 percent from the same period of 2007 but down nearly 40 percent from the first quarter of this year, according to the firm’s quarterly report.
Some 8.1 percent of capital raised by the 10 funds in the second quarter, or $972 million, target investments in Chinese property markets despite China’s tight monetary policy, which may hurt its real estate industry.
Financial Times- Coal prices have doubled over the past year to record levels and could spike even higher as a power crisis in China combines with supply problems in leading exporting countries to tighten the market further.
The surge in prices coincides with fresh interest from hedge funds and other investors looking to gain exposure to the commodity thanks to greater liquidity in the previously opaque over-the-counter coal market.
"Coal has the strongest fundamentals of any commodity play," says Adam Knight, co-head of commodities at Credit Suisse.
Detroit Free Press- Delphi Corp. has hired a Detroit investment bank to find a buyer for its brake business, which has been for sale for more than two years.
The Troy supplier said Monday that it hired W.Y. Campbell & Co., owned by Comerica Bank, to sell the business, which employs 1,000 people, including 100 in Michigan.
Delphi already has sold portions of its brake business in Mexico and Saginaw. Delphi hired W.Y. Campbell to sell the rest of the business, which includes technical centers in Brighton, Dayton, Ohio, and Shanghai, as well as three factories in Mexico and China. The brake business is expected to generate $295 million in revenue this year.
Delphi, with total sales of $22.3 billion last year, is trying to sell its brake business at time when it has become tougher for companies to find buyers for unwanted units.
BEIJING (Reuters) – Bank of Communications Schroders Fund Management Co is aiming to raise up to 1 billion yuan for its first overseas fund later this month, despite sliding global financial markets, two company sources said.
Poor market conditions have sapped interest in funds launched recently under China’s Qualified Domestic Institutional Investor QDII.L scheme, which offers residents the chance to diversify their portfolios by buying global stocks and bonds.
In May, Yinhua Fund Management Co raised just 417 million yuan for China’s seventh QDII fund from a fund-management firm, far below its $2 billion target.
One of the sources said Bank of Communications Schroders was under pressure from the securities regulator to start marketing its first fund if it wanted to secure permission to launch others later.
HONG KONG (Reuters)- As risk appetite for equities and property wanes, investors are willing to endure negative real returns for bonds from China, Singapore and Hong Kong because their economies are seen better equipped to tackle inflation.
Conventionally, bond yields have to be sufficient to compensate investors for their holdings as inflation erodes value over time, but those seeking safe haven destinations are choosing to brave lower returns in some markets.
Bond investors are proving less patient with India, Thailand and the Philippines, markets where yields will continue to rise on worries about fiscal imbalances and authorities’ limited effectiveness in overcoming inflation.
Forbes.com – The UK government is advising China on its private equity industry, with the Treasury passing papers on tax and regulation to Beijing, the Financial Times reported.
The newspaper said the move reflects London’s desire to gain a strategic advantage over the US in China, where private equity groups are eyeing investment opportunities.
‘We have pointed them in the right direction by passing on papers about a range of fiscal and regulation policies for private equity,’ the newspaper quoted a senior Treasury official as saying.
