Sunday, July 5, 2009

Carlyle Group Gets Serious About China

In 2000, Carlyle Group raised $159 million raised for its first Asia fund. $164 million in its second fund in 2002 and $680 million for its third fund in 2005.

Carlyle just completed a raise of $1 billion for its fourth Asia Growth Partners Fund.

The Carlyle managers identify their investment strategy as investing in high growth private companies with local management and leading market positions in China as well as other Asian countries. It seeks companies that are not publicly registered and takes a longer time horizon than hedge funds which normally concentrate on publicly registered companies.

An early Chinese investments made by The Carlyle Group was, an online and offline hotel reservations and travel service provider. Today Ctrip trades on the NASDAQ in the US and it has had a bumpy ride. Year to date, its stock has almost doubled in value. However, has not been invincible as its stock declined from 71 to 16 in 2008. Bottom line, it looks like will, not surprisingly trade in line with China's economy. Given the amount of money China is pumping, it should be a rocket upwards until the consumer price inflation hits.

According to ChinaStakes, other investments made by Carlyle Asia funds include (1) DIO F&B Co., Ltd of Suzhou, China which is believed to be the largest coffee shop/leisure dining food and beverage chain in China, (2) Hao Yue Education Group of Beijing which is a private higher education service provider in China(3) Babela Restaurant Management Co. Ltd of Shanghai which is an Italian-style restaurant chain, (4) China Real Estate Network of Tianjin believed to be the largest real estate brokerage company in China with nationwide network coverage, (5) Focus Media Holdings Limited of Shanghai which develops interactive advertising, and (6) ZCom Company Limited of Beijing which designs and provides a digital content delivery platforms.

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