Cathay Capital raises 600 million euros for investment fund

Cathay Capital Private Equity raised 600 million euros ($704 million) on Monday as the first closing for its investment fund targeting companies mainly in China and the Europe. 

The fund, called Cathay Midcap II, was backed by Cathay’s previous cornerstone limited partners China Development Bank and France-based Public Investment Bank (also known as Bpifrance), as well as a mix of sovereign funds, institutional investors and family offices.

The private equity firm said it will use this new investment vehicle to support medium-sized enterprises with high potential for growth and capability to expand internationally. Core markets will include China, France, Germany and some countries in North America.

Targeted sectors will be healthcare, high-end industries, consumer goods and business services, according to the company.

Mingpo Cai, president and founder of Cathay Capital, said "This new investment vehicle will leverage Cathay Capital’s expertise accumulated over the past decade to help hidden champions in their international acceleration to become world-class leaders and to create superior returns for investors." 

According to Cai, the fund aims to raise a total of 1.2 billion euros by the first half of 2019.

Cathay Midcap II is the first fund invested by the China-EU Co-investment Fund program, which was established by the European Investment Fund and the Silk Road Fund for developing synergies between the Investment Plan for Europe and China’s Belt and Road Initiative.

It was officially launched at the beginning of this year with the signing of a Memorandum of Understanding between CDB, Bpifrance and Cathay Capital, during French President Emmanuel Macron’s visit to China.