Shelter in a Storm Mohamed of Malaysian Pension Fund KWAP Are China-Focused PE Firms Getting the Best Downside Protection? Page 7 Page 15

Asia’s Private Equity News Source avcj.com September 30 2014 Volume 27 Number 36

EDITOR’S VIEWPOINT Why Asia is likely to see a wave of venture capital opportunity funds Page 3

NEWS Accel, AIF, Boyu, CHAMP PE, CVC, IDG, KIC, KKR, KPCB, Legend, Lightspeed, New Asia Partners, Shunwei, Tata, Tiantu, Tiger Global Page 4

DEAL OF THE WEEK Sinarmas supports Ardent Capital’s SE Asia expansion plan Page 13

LP INTERVIEW Nik Amlizan Binti Shelter in a storm Mohamed of Malaysian pension fund KWAP Are China-focused PE firms getting the best downside protection? Page 7 Page 15

DEAL OF THE WEEK FOCUS

Call the handyman RMB reawakening J-Star secures 8x return on Burn Repair Page 13 Foreign firms get interested in QFLP PE Page 14 Private Equity & Venture Forum Taiwan 2014 20 November • Westin Taipei

GLOBAL PERSPECTIVE, LOCAL OPPORTUNITY avcjtaiwan.com SAVE Early Bird Ends on 9 October US$200 Register now at avcjtaiwan.com Simultaneous translation between Chinese and English will be available throughout the event

Confirmed speakers include: Chien-Yi Chang Ming Bin Chang Andrew S. Hawkyard Director, Research Division II Deputy Director-General Chief Operating Officer TAIWAN INSTITUTE OF INVESTMENT COMMISSION, MORGAN STANLEY ECONOMIC RESEARCH MOEA PRIVATE EQUITY ASIA

Richard Hsu CY Huang Nisa Leung Managing Director President Managing Partner INTEL CAPITAL FCC PARTNERS QIMING VENTURE PARTNERS

Gordon Shaw Weichou Su Sonia Sun Managing Director, Shanghai Partner Partner BARING PRIVATE EQUITY STEPSTONE GROUP KPMG LAW FIRM ASIA

Paul Wang Bill Wiseman Brooke Zhou Managing Partner Partner Executive Director - Asia PACIFIC VENTURE MCKINSEY & COMPANY Pacific, Private Equity PARTNERS LGT CAPITAL PARTNERS

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Scan this QR code with your mobile Join your peers phone to review AVCJ Taiwan avcjtaiwan.com #avcjtaiwan latest updates Private Equity & Venture Forum EDITOR’S VIEWPOINT Taiwan 2014 [email protected] 20 November • Westin Taipei Managing Editor Tim Burroughs (852) 3411 4909 Staff Writers Andrew Woodman (852) 3411 4852 Winnie Liu (852) 3411 4907 Top-up time Creative Director Dicky Tang Designers Catherine Chau, Edith Leung, Mansfield Hor, Tony Chow NORTHERN LIGHT VENTURE CAPITAL 2012 at $270 million, around $50 million larger would like to have participated in the recent $50 than the previous vehicle. But Snapdeal was Senior Research Manager GLOBAL PERSPECTIVE, LOCAL OPPORTUNITY avcjtaiwan.com Helen Lee million Series D round of funding for Daojia, but growing even faster. Nexus and Kalaari Capital Research Associates it could not. The Series C round last September backed the e-commerce company in its Herbert Yum, Isas Chu, wasn’t possible either. As it stands, the VC firm infancy, providing a $12 million Series A round Jason Chong, Kaho Mak SAVE Early Bird Ends on 9 October has recorded a handsome paper gain on its in early 2011. It stuck with Snapdeal through Circulation Manager Series B investment in the Chinese food-ordering the next two rounds and then in March 2014 Sally Yip platform, but the upside now appears to be the company raised $133.8 million in Series D Circulation Administrator Register now at avcjtaiwan.com Prudence Lau US$200 limited. funding. This was said to be the first deal out of Subscription Sales Executive “We have a very small percentage stake the opportunity fund. Jade Chan and the valuation of the company has grown A top-up vehicle is not a perfect solution. If Simultaneous translation between Chinese and English will be available throughout the event Manager, Delegate Sales much faster than anticipated so we didn’t have some LPs are in both the main and opportunity Pauline Chen the opportunity to participate in the Series C,” funds while others have an interest in just one, Director, Business Development Confirmed speakers include: explains Ray Yang, a managing director at the it can create conflicts. Questions might also be Darryl Mag VC firm. “We would love to get more shares if we asked about strategy drift. Investors may benefit Chien-Yi Chang Ming Bin Chang Andrew S. Hawkyard Manager, Business Development could, but we can’t.” from continued exposure to successful portfolio Anil Nathani, Samuel Lau Director, Research Division II Deputy Director-General Chief Operating Officer As certain companies stay under private companies, but shouldn’t Nexus be focusing on TAIWAN INSTITUTE OF INVESTMENT COMMISSION, MORGAN STANLEY Sales Coordinator ownership for longer periods of time and finding the next Snapdeal? Debbie Koo ECONOMIC RESEARCH MOEA PRIVATE EQUITY ASIA raise ever large pools of capital required to Nevertheless, the sheer size of the rounds accumulate market share, what happens to the some tech companies are now raising in Conference Managers Jonathon Cohen, Sarah Doyle, Richard Hsu CY Huang Nisa Leung early investors? Although a degree of dilution Asia suggests that there will be a place for Conference Administrator Managing Director President Managing Partner is inevitable over time, they are sitting on opportunity funds. AVCJ Research has records Amelie Poon INTEL CAPITAL FCC PARTNERS QIMING VENTURE potentially huge returns on what started out as of 50 VC rounds of $100 million or more in the Conference Coordinator Fiona Keung, Jovial Chung PARTNERS relatively small bets. What, though, if they wanted region, of which 33 were completed in 2013 and to re-up and continue participating in the growth 2014. India’s Snapdeal and Flipkart and China’s Publishing Director Gordon Shaw Weichou Su Sonia Sun story? The problem is that doing so might go JD.com and Xiaomi feature high up the rankings Allen Lee Managing Director, Shanghai Partner Partner against the fund remit and exceed the maximum and multiple times in the list as a whole. Managing Director BARING PRIVATE EQUITY STEPSTONE GROUP KPMG LAW FIRM check size. Smaller VCs can’t stop DST Advisors, Tiger Jonathon Whiteley ASIA US venture capital firms have already found Global and Temasek Holdings coming in, but an answer – opportunity funds, which focus they might find a way to ensure these investors Paul Wang Bill Wiseman Brooke Zhou on later-stage investments in existing portfolio don’t eat all of the lunch. companies – and there is every reason to believe Incisive Media Managing Partner Partner Executive Director - Asia Unit 1401 Devon House, Taikoo Place it will catch on in Asia as well. Indeed, earlier this 979 King’s Road, Quarry Bay, PACIFIC VENTURE MCKINSEY & COMPANY Pacific, Private Equity Hong Kong PARTNERS LGT CAPITAL PARTNERS year Indian VC Nexus Venture Partners raised a T. (852) 3411-4900 $110 million opportunity fund from its current Tim Burroughs F. (852) 3411-4999 E. [email protected] LP base. Managing Editor URL. avcj.com For the latest programme and speaker line-up, please visit avcjtaiwan.com Nexus closed its third main fund in September Asian Venture Capital Journal Beijing Representative Office No.1-2-(2)-B-A554, 1st Building, Registration enquiries: Pauline Chen T: +852 3411 4936 E: [email protected] No.66 Nanshatan, Chaoyang District, Beijing, Enquiry Sponsorship enquiries: Darryl Mag T: +852 3411 4919 E: [email protected] Asia’s largest VC funding rounds People’s Republic of China Date Amount (US$m) Round Investee T. (86) 10 5869 6203 Speaking enquiries: Joy Qian T: +852 3411 4866 E: [email protected] F. (86) 10 5869 6205 Jul-14 1,000.0 7 Flipkart E. [email protected] Mar-11 961.0 4 JD.com Asia Series Sponsor Co-Sponsors Nov-12 682.0 5 JD.com Jul-13 360.0 5 Flipkart The Publisher reserves all rights herein. Reproduction in whole or in part is permitted only with the written consent of Sep-14 260.0 3 YouXinPai.com AVCJ Group Limited. Apr-14 250.3 1 Campaign Monitor ISSN 1817-1648 Copyright © 2014 Dec-13 250.0 3 Lazada South East Asia Jun-12 216.0 3 Xiaomi Knowledge Partner May-14 210.0 6 Flipkart Aug-14 200.0 3 Ganji.com Source: AVCJ Research Scan this QR code with your mobile Join your peers phone to review AVCJ Taiwan #avcjtaiwan latest updates avcjtaiwan.com Number 36 | Volume 27 | September 30 2014 | avcj.com 3 NEWS

KKR restructures Asia participation from Sina, Redpoint Ventures and AUSTRALASIA StarVC, a VC firm launched by a group of Chinese leadership team celebrities. Local microblog service Sina Weibo Nuplex in asset sale talks David Liu and Ming Lu have been appointed is a strategic partner of Miaopai, which enables co-heads of Asia private equity at KKR as several users to shoot up to 10 seconds of footage and with CHAMP PE members of the firm’s leadership team across then edit before sharing on Weibo. CHAMP Private Equity is in talks with New the region assume additional responsibilities. Zealand-based chemicals manufacturer Nuplex Joe Bae remains head of KKR Asia and chairman Legend leads $50m for Industries over the potential acquisition of its of the regional investment committee. The new distribution and plastics additives businesses. The management structure, which was confirmed by online finance site assets that could be sold are Nuplex Specialties, a KKR spokesperson, comes as the firm increases Legend Capital has led a $50 million Series B which distributes raw materials, ingredients and its exposure to Asia up and down the capital round of funding for Tongbanjie, a Chinese online specialty chemicals, and Masterbatch, a supplier structure and in finance mobile app, with participation from of colors used in plastics. multiple asset existing investors IDG Capital Partners and China classes. Growth Capital. The start-up plans to use the Australia’s Treasury Wines Liu (pictured) new funding to add different types of products, and Lu, heads including insurance and credit loans, and provide ends PE buyout talks of KKR in China self-developed investment portfolios. Australia’s Treasury Wine Estates has ended talks and Southeast with two private equity suitors, TPG Capital Asia, respectively, Lightspeed leads round for and a consortium comprising KKR and Rhône have seen their Capital, after deciding the offer was too low. PE remits expand P2P car-sharing site The company said shareholders had indicated to cover the Lightspeed China Partners has led a $10 million that the bid price of price of A$5.20 per share entire region. Series A round of funding for uuzuche.com, a undervalued the company. Justin Reizes, who Chinese peer-to-peer (P2P) car-sharing platform. leads the firm’s activities in Australia, is now also China Renaissance K2 Ventures and angel Accel, Ribbit lead $35m supporting the build-out of an Asia-wide energy investor Wang Gang also participated. Uuzuche and resources platform, while Sanjay Nayar will currently operates in four major cities with over round for invoice app supplement his duties as India head with work 10,000 car owners on the platform. Australia-based invoicing app Invoice2go has on KKR’s credit and capital markets offerings in received $35 million in a Series A round of the region. IDG invests in mobile tech funding led by Accel Partners and Ribbit Capital. In addition, Scott Bookmyer will leave his The company was founded in 2002 but this is its role as Asia head of Capstone, which works player AVOS Cloud first external funding. Alongside the investment, with KKR portfolio companies on operational IDG Capital Partners has invested in a Series A Accel’s CEO-in-residence, Greg Waldorf, has improvements, and become the firm’s chief round of funding for AVOS Cloud, a Chinese joined Invoice2Go as its new CEO. operating officer in the region. In this capacity, he mobile back-end as a service (BaaS) provider. will oversee key elements of KKR’s Asia business Financial terms were not disclosed. AVOS Cloud operations. Responsibility for Capstone’s activities was spun-off from AVOS System, a US internet GRATER CHINA will fall to a leadership team comprising senior company set up by YouTube founders Chad representatives from each geographic region Hurley and Steve Chen, earlier this year. PE-backed apparel maker within Asia. eyes $285m HK IPO Shunwei backs female Ladies apparel maker Shanghai La Chapelle, Tiantu in $63m first close social networking site which is backed by several PE investors, plans to on debut US dollar fund Shunwei Capital Partners has committed $10 raise HK$2.21 billion ($285 million) through an million in Series B funding to 520guimi.com, a IPO in Hong Kong. Legend Capital holds 17.81% Chinese GP Tiantu Capital has reached a first female-focused social networking site in China. of the firm while Goldman Sachs owns 3.75% close of $63 million on its debut US dollar- Existing investor Lightspeed China Partners also interest. Boxin Capital’s ownership is 8.83%, while denominated fund. A final close of $100 million participated. The new funding will be used to Asia Alternatives has a 0.83% stake. is targeted before the end of the year. The Tiantu improve user experience through the addition China Consumer Fund I received $38 million in of new features to the platform, as well as for Boyu joins consortium for commitments from family offices and fund-of- marketing and promotions. $2.5b GLP investment funds in Asia and the US, while an additional $25 million was contributed by the GP. Alibaba invests $458m in Boyu Capital and several Chinese strategic hotel IT software firm investors have joined a consortium that has KPCB leads $50m round for committed $2.5 billion to warehouse operator Alibaba Group has bought a 15% stake in Global Logistic Properties (GLP). The deal was China video app Beijing Shiji Information Technology, a Chinese announced in February, with Hopu Investment KPCB has led a $50 million Series C round of hospitality information technology developer, for Management confirmed as a participant. funding for Chinese video app Miaopai, with RMB2.81 billion ($458 million). The investment is

4 avcj.com | September 30 2014 | Volume 27 | Number 36 NEWS

expected to allow Alibaba to develop its Taobao Intel invests $1.5b in INR640 million ($10.5 million) to the company. Travel business alongside Beijing Shiji, including Tsinghua chipmakers hotel information management system and Local-language media start- mobile payment solutions. Intel Corporation has agreed to invest up to RMB9 billion ($1.5 billion) for a 20% stake in Tsinghua up gets $16m Unigroup, owner of Chinese semiconductor Sequoia Capital has led a INR1 billion ($16.4 NORTH ASIA makers Spreadtrum Communications and RDA million) round of funding for Verse Innovation, Microelectronics. owner and operator of India-based local- KIC more than doubles PE Tsinghua Unigroup is a unit of Tsinghua language mobile platform NewsHunt. This is Holdings, an investment entity controlled Verse’s second round of funding and it values the exposure in 2013 by Beijing-based Tsinghua University. Both seven-year-old company at nearly $150 million. Korea Investment Corporation’s (KIC) private Spreadtrum and RDA develop mobile chipset Existing investors Matrix Partners India and equity investments more than doubled in size to platforms for smart phones, feature phones Omidyar Network also participated. $2.6 billion over the course of 2013 as total assets and other consumer electronics products, increased 27% year-on-year to reach $72 billion. supporting 2G, 3G and 4G wireless standards. As The sovereign wealth fund has achieved a 4.02% part of the agreement, Spreadtrum will develop SOUTHEAST ASIA annualized return since its inception in 2006 architecture-based system-on-chips (SoCs) jointly but private equity - for which the investment CVC-owned SPi to sell US program began in 2009 - is the worst-performing of the alternative asset classes. healthcare business SPi Global, a Philippines-based business SCPE backs garlic-themed process outsourcing (BPO) provider owned by CVC Capital Partners, has agreed to sell its US restaurant in Korea healthcare business to Conifer Health Solutions in Standard Chartered Private Equity (SCPE) has led a deal worth $235 million. SPi Global will retain its a $48 million joint investment in Mad for Garlic, healthcare BPO operations in the Philippines. a Korea-based Italian restaurant chain. There are 29 outlets in Korea and four in Singapore, the Singapore supports med- Philippines and Indonesia. The company wants to enlarge its domestic network and also enter the with Intel, which will be marketed to domestic tech accelerator program likes of China, Hong Kong, Vietnam and Taiwan. mobile phone-manufacturing customers from Spring Seeds Capital, an investment arm of the second half of next year. government-backed Spring Singapore, has Pavilion, Recruit provide “China is now the largest consumption market launched an initiative that could channel up for smartphones and has the largest number of to S$60 million ($47 million) into local medical Series B2 for Japan’s Freee Internet users in the world,” said Brian Krzanich, technology start-ups. The government will invest Temasek Holdings-owned Pavilion Capital Intel’s CEO. “These agreements with Tsinghua in S$30 million, with an equal sum to be raised and Recruit Strategic Partners, the VC arm of Unigroup underscore Intel’s 29-year-long history by two new-established accelerators - Zicom Recruit Holdings, have led a Series B2 round of investing in and working in China.” MedTacc and Med Tech Alliance. of funding worth $6 million for Freee, a Tokyo- Last year, Tsinghua Unigroup took Spreadtrum based provider of automated online accounting private in a deal worth $1.7 billion. Previous New Asia, AIF commit to software. This follows a Series B1 round of $8 investors in Spreadtrum include New Enterprise million provided by DCM and Infinity Ventures. Associates and Silver Lake. Tsinghua Holdings is a Vietnam restaurant chain state-owned company that manages the majority New Asia Partners and AIF Capital have led a of Tsinghua University’s commercial assets. Series B round of funding worth $15 million for SOUTH ASIA Huy Vietnam Group, Vietnam’s largest operator of self-managed, local cuisine restaurants. Other Canaan’s Khanna to launch Mumbai-based Standard Greases & Specialities investors include Malaysia-based Fortress Capital for an undisclosed sum. The PE firm will subscribe Asset Management and regional family offices. India venture debt fund to new shares in the company via the Tata Capital Canaan Partners managing director Rahul Growth Fund and Singapore-based Alpha TC VC-backed iMoney gets Khanna is to launch a INR3 billion ($49 million) Holdings. Each entity will hold an 8.68% stake. debt fund aimed at supporting early-stage and funding from iSelect established technology ventures in India. Khanna Tiger Global commits $30m IMoney Group, a Malaysia-based financial is leaving Canaan and will be involved with the comparison start-up backed by Jungle new venture full-time from early next year. to property portal Ventures, has received approximately MYR13 Tiger Global has invested $30 million in India- million ($4 million) from iSelect, an Australia Tata Capital buys minority based property listings website CommonFloor. Securities Exchange-listed online comparison com, which is ultimately expected to pursue a service. The capital will be used to accelerate stake in Standard Greases public listing. The funding comes less than a year growth, strengthen the management team and India’s Tata Capital is to acquire a 17.36% stake in after Tiger Global and Accel Partners committed investment in technology.

Number 36 | Volume 27 | September 30 2014 | avcj.com 5 15th Annual Private Equity & Venture Forum India 2014 2-3 December • Taj Lands End, Mumbai

MODI-F.I.E.D. - FUELLING INDIA'S ECONOMIC DEVELOPMENT

Keynote address Register before 17 NOVEMBER What’s hot this year? to SAVE

 Opening panel session on the INR18,090/ State of Play for PE in India US$300  Executive address by Renuka Ramnath, Founder, MD & CEO of MULTIPLES ALTERNATE ASSET MANAGEMENT Peter Casey  Investor Selector: a highly interactive and Executive Chairman, entertaining session on “What do LP’s really CLADDAGH RESOURCES look for in a GP when deciding where to Investor, DRAGONS’ DEN Author, THE WORLD’S commit their money” GREATEST COMPANY: THE STORY OF TATA

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Scan the QR Join your peers code with your Tweet #avcjindia mobile phone to access the latest avcjindia.com event updates 15th Annual Private Equity & Venture Forum COVER STORY India 2014 [email protected] 2-3 December • Taj Lands End, Mumbai Parachute play All PE investors want downside protection in China, but they prefer to use it as leverage in amicable negotiations rather than pursue full enforcement. Knowing the entrepreneur and the business is crucial

SEARCHING FOR ANALOGY THAT pressured by the presence of these rights, so Before the global financial crisis and more captures the deterioration in relations between they are useful in terms of having both carrot recent cooling of China’s domestic IPO market entrepreneur and investor, Johannes Schoeter and stick,” says Bonnie Lo, partner at NewQuest plenty of investors rushed in looking to flip eventually settles upon two pandas paired Capital Partners. “If an investment goes south for companies into public listings. The strategy was MODI-F.I.E.D. - FUELLING INDIA'S ECONOMIC DEVELOPMENT together at a zoo with a view to procreation. No whatever reason there is a way to bring everyone short term and largely passive, and some paid matter what is tried, the male shows no interest to the negotiating table. You might not get 100% the price for not paying enough attention to whatsoever in the female. of what the put option says, but the success portfolio companies or the downside protection Keynote address Register before China New Enterprise Investment (CNEI), the rate for getting founders to buy back shares is in the deals. The general view is that PE firms are 17 NOVEMBER PE firm of which Schoeter is founding partner, reasonably good.” now better prepared and better advised. should have been on course for a 5x return. It “In the old days, investors would come in What’s hot this year? to SAVE held a stake in a Chinese business with strong Devil in the detail and get a board seat and information rights,” fundamentals, an impressive product portfolio, Downside protection for minority investments in says Michael Chin, a Shanghai-based partner at  Opening panel session on the INR18,090/ and a long-standing and recognizable brand China comes into effect if a portfolio company Hogan Lovells. “Now they appear to be getting a name. There was every reason to foresee fails to meet certain performance targets or if an lot more involved. We had a wave of PE firms that State of Play for PE in India US$300 sustained growth and ultimately an IPO exit. IPO doesn’t happen within an agreed timeframe. were sitting on too many portfolio companies  The problem was the founder and majority A PE firm might seek to redeem its investment and there were instances in which companies Executive address by Renuka Ramnath, shareholder. Not long after CNEI’s investment, he according to a formula based on interest or IRR had gone too far down hill to turn things around Founder, MD & CEO of MULTIPLES ALTERNATE became distracted by real estate opportunities, or trigger a ratchet mechanism that increases its because of insufficient monitoring.” ASSET MANAGEMENT to the detriment of the main business. Various holding in the portfolio company. All investors want an element of downside efforts were made to reengage the founder but Many investments are made in the form of protection, but what they get is highly Peter Casey  Investor Selector: a highly interactive and to no avail. Eventually it was agreed that CNEI subscriptions to convertible bonds or preference negotiated – maybe there is no put option at Executive Chairman, entertaining session on “What do LP’s really would install a new CEO but the founder, in full shares that give the private equity firm a priority all. It is one of many variables within a deal. The CLADDAGH RESOURCES look for in a GP when deciding where to procrastination mode, vetoed every candidate. claim in the event of a default. It is common decision whether or not to invest is based on Investor, DRAGONS’ DEN With CNEI applying pressure, the founder Author, THE WORLD’S commit their money” decided he’d had enough. “We were already quite China growth capital investment GREATEST COMPANY: THE exhausted from all our efforts when he came STORY OF TATA to us and asked to buy back our shares on the 15,000 500 strength of our put option,” Schoeter recalls. “We 12,000 For the latest programme and speaker line-up, visit avcjindia.com said, ‘You can buy them back but at a different 400 price from the put option because we aren’t 9,000 putting to you, we are selling to you.’ In the end 300 Registration enquiries: Sponsorship enquiries: he agreed. The put option would have given us 6,000 Deals US$ million 200 Yeni Kittrell T: +852 3411 4836 Anil Nathani T: +852 3411 4938 about 1.7x but we received 2.2x.” 3,000 E: [email protected] E: [email protected] Enquiry The situation was unusual – a PE firm would typically take the initiative and tell the founder 0 100 that it wanted to exercise a put option in order to 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 YTD exit an investment – yet it is still instructive. Disclosed deals Amount (US$m) Asia Series Sponsor Co-Sponsors While a put option is usually a highly Source: AVCJ Research structured piece of downside protection, its true merit is in providing leverage, not necessarily facilitating execution to the letter of the law. The for the founder to pledge his own shares in the the GP taking a step back, evaluating the entire threat of redeeming a position, and taking the company as security for an investment. Unsigned situation and asking if he feels comfortable with assets held as security or finding a way to turn letters of resignation from the founder’s the situation. In the absence of a put, being the screw on the founder, is part of a broader representative board members and share transfer comfortable with the founder is also paramount. Knowledge Sponsor Luncheon Host Cocktail Reception Host Exhibitor negotiation. And success rests on understanding agreements are held in escrow and released “It comes down to a judgment call on his the business and its majority owner, so the to the investor if there is a desire to claim the personality, his quality as an entrepreneur and process – if there is no way of making it amicable security and assume control of the company. the quality of the business,” says CNEI’s Schoeter. and mutually beneficial – is at least smooth. In some cases, the founder might also offer “If I were an entrepreneur negotiating with a “Put options are not foolproof but only a personal guarantee comprising onshore or capital provider, I would say, ‘Why would I do Scan the QR Join your peers code with your in extreme cases would a founder not feel offshore assets. this? We are partners, we both succeed or fail.’ It Tweet #avcjindia mobile phone to access the latest avcjindia.com event updates Number 36 | Volume 27 | September 30 2014 | avcj.com 7 COVER STORY [email protected]

is not 100% correct because he is running the comfortable with the second approach, investing First of all, investor agreements can be used show. But it is natural for an entrepreneur, almost through a Sino-foreign joint venture. This route to make things happen without resorting to as a reflex, to give this response.” precludes a listing in Hong Kong or the US enforcement. For example, there may be clauses Indeed, not getting this response might in because there is no offshore restructuring, but that prevent a company from taking certain itself be a red flag. William Shen, senior partner at it became popular with the rise of the A-share actions – such as incurring a large amount of Headland Capital Partners, treats the negotiations market as a public market exit option. debt or making disposals and acquisitions – as an additional opportunity to get a measure The private equity firm invests directly into without the PE investor’s approval, which offers of the founder. If he rolls over on every point he the onshore entity, and in the event of a dispute, additional leverage. Documentation allowing might not be taking the prospect of redemption it can opt for for a court process or arbitration. a change of board control at the offshore level seriously or he has no intention of honoring it. There is no two-step process of getting mainland can also be effective when used in tandem with endorsement of an offshore ruling. Clarifying proactive onshore tactics. Degrees of comfort where the case is heard is important, with most When NewQuest spun out from Bank of The amount of leverage a private equity firm has investors happy to go through Beijing and America Merrill Lynch, the portfolio the firm in a redemption situation is also influenced by Shanghai. Other locations could be deal breakers. brought with it included a Chinese company the structure of the investment. There are two “We have turned down deals for the sole where there seemed little chance of a return. But ways in, the most common being an investment reason that the entrepreneur insisted on NewQuest held pre-signed letters of resignation in an offshore holding company, which operates having dispute resolution in his local area,” says for the founder’s board representatives and share on the mainland through a wholly foreign- CNEI’s Schoeter. “In smaller cities, most of the transfer documents. The founder came to the table and the PE firm negotiated a $50 million buyback – acceptable, given the circumstances. “Put options are not foolproof but only in “Everything we did was focused on the offshore part but we also sent in people to take extreme cases would a founder not feel pressured charge of the company’s chops. We also had by the presence of these rights” – Bonnie Lo someone dedicated to understanding the cash flow situation,” Lo explains. “There were pressures we could exert.” owned enterprise (WFOE). This structure tends to entrepreneurs have connections with the local In short, information is power – but it must be used where the objective is an offshore IPO. government in one way or another. They could be used wisely. Protection measures enshrined The security held by the private equity firm just call the mayor or local party secretary and ask in the investor agreement must be underpinned tends to be pledged shares in the offshore them to tell the judge not to accept the case.” by a thorough understanding of whether the vehicle. In order to take action against a founder A potential problem raised by Steven Tran, company or entrepreneur has both the incentive or company that refuses to redeem a position, a Hong Kong-based partner at Hogan Lovells, and means to honor a redemption order. it is necessary to secure a favorable ruling from is that put options can be difficult to enforce First, it is important to look into an a judge or arbitrator in the offshore jurisdiction onshore. Chinese courts do not recognize entrepreneur’s net worth and whether he has of incorporation and then go to a Chinese court specific performance – through which an other business interests. Second, understanding and make the application once again. individual can be compelled to comply with an the company’s debt situation can be useful. For Even if the protection extends down another obligation – in the same way as Common Law example, there may be a lot of bank loans with layer and there is a pledge of shares in the jurisdictions. An investor cannot simply go to a cross-default clauses and refusing to redeem a WFOE, enforcement is a challenge. Investors that local court and seek a ruling against a founder by PE investor’s convertible bond could ultimately register WFOE share securities with the State saying he gave a guarantee and has breached his lead to banks foreclosing on the business. Would Administration of Foreign Exchange (SAFE) up obligation to pay us money. the founder want to risk losing everything for the front should be able enact the pledge when sake of a $50 million settlement? necessary. But there are still obstacles. Trigger happy? At the same time, a private equity investor “When it comes to enforcement, although A reluctance to pursue an action through the must bear in mind what that $50 million means you have the legal right, when you register the Chinese courts is one reason why some investors to the company. If immediate repayment would transfer of equity interests in a Chinese company, hold off on redemptions when perhaps they bankrupt the business then the entrepreneur is the transfer of shares, the State Administration for should act. Several industry participants say likely to resist honoring the put option regardless Industry & Commerce (SAIC) would then query they have seen GPs accept an entrepreneur’s of the consequences. This understanding should whether or not you could do that,” says Howard argument for why next year will be different stretch to the industry in which the company is Lam, a partner at Latham & Watkins. “And then and then de-focus on the investment in favor of operating. If the founder is fighting against an the existing management in the WFOE might better-performing assets. They are also motivated irrevocable industry downturn, there is no point resist that and their cooperation is needed to file by a desire to preserve relationships. waiting for a turnaround. the necessary forms with the SAIC to complete “They want to show they are investors that “You can put everything down on paper the transfer of the shares.” work alongside companies to solve issues rather and he can agree it all, but you have to talk to Headland’s Shen adds that a Chinese than investors that pull the trigger at the first the company and check up every day from entrepreneur might just take a ruling by a Hong sign of a dispute,” adds Tran. “When there is a the outset. Has the business changed? Is the Kong arbitrator seriously than notice issued by a dispute, PE investors will usually try and deal with entrepreneur taking money out of the business?” Chinese court. “It could drag on for a long time it amicably from a commercial and a relationship says Junlee Hsu, a partner at Headland. and the costs could be high,” he says. perspective, and keep the dispute out of the Through this ongoing dialogue, a PE investor As such, Headland is generally more public domain.” can make management aware that a redemption

8 avcj.com | September 30 2014 | Volume 27 | Number 36 COVER STORY [email protected]

notice is likely to come and also provide advice as and we will put in money to show we believe in “Entrepreneurs are more open to it now than to how a company experiencing distress might the idea. If things go well, we get some equity 3-5 years ago because the IPO market is much generate the required funds. upside. If things go really badly, just treat it as a tougher,” Shen says. “In the old days a China IPO A previous Headland portfolio company in loan and return the money plus some interest,’” story was worth 20x but now the market is more Taiwan had a legal dispute with one of its largest he told AVCJ earlier this year. selective, there is no scarcity value for copy cats..” distributors in the US. Distracted by the situation, Ascendent eschews downside protection Beyond that, the negotiating dynamics will management neglected the business and it that heavily penalizes a company, arguing that remain largely unchanged. A GP must make a suffered. Headland’s put option wasn’t due to the entrepreneur might just respond by fudging judgment call on an entrepreneur’s character and come into effect for two years but in ahead of the the accounts. Rather, the private equity firm ability, and whether he will have the means and deadline it starting working with management returns equity to the founder if growth exceeds motivation to honor a redemption should the on potential solutions. This resulted in the sale projections and cash is returned ahead of need occur. Strong documentation is required of one of the core assets that gave the company schedule. For example, Ascendent might own but also a grasp of a company’s operations and sufficient financial resources to redeem the GP. 40% of a company with a 2x put option after what can be done to ensure an entrepreneur’s “You need to think in their shoes,” adds Hsu. four years and a preferred dividend stream that interests are aligned with those of the investor. “You are asking for the money back but how guarantees it covers its costs. If capital is returned Access to information is crucial and it should can they get it? Can they cut costs? If that’s not earlier it may reduce its holding to 37.5%. be crafted into a clear set of guidelines that enough, what about selling part of the business? are finalized before going anywhere near the Sometimes entrepreneurs procrastinate – these Same but different negotiating table. businesses are their babies so it is difficult for The mechanisms that underpin downside “Downside protection is very useful as a them to sell. However, it is better for everyone protection will no doubt continue to evolve as pressure point to negotiate a way out of a if there the company is still there rather than risk perceptions and markets evolve. One clause distress situation,” says Lam of Latham & Watkins. bankrupt. It takes time to change their thinking.” that Headland is already trying to work into “PE investors should identify the potential exit Liang Meng, managing partner at Ascendent agreements is a drag-along right for a trade sale. first and consider using enforcement steps to Capital Partners, is also an advocate of the It is a natural response to less vibrant IPO markets steer towards that exit. The offshore and onshore constructive approach, regarding as in tune in China. If a company is performing sufficiently steps will need to be coordinated. Never go into with his firm’s strategy of sourcing deals through well that it doesn’t trigger redemption clauses, enforcement when there is less certainty as to building advisory relationships with companies. but it can’t go public at a particularly high how local authorities and courts would behave. “A lot of conversations run along the lines valuation then a trade sale might be the best You need to have the deal pre-packaged before of us saying, ‘Let’s develop this idea together option for all concerned. implementation.”

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How much does it cost? That depends on how much access you want, but we can customise cost-e ective packages to all rms, regardless of size. For more information, contact Sally Yip at +(852) 3411 4921 or email [email protected] and we will be happy to discuss with you. Asian Venture Capital Journal DEAL OF THE WEEK [email protected] / [email protected] avcj.com site licences J-Star seals first secondary exit

JAPAN HAS SEEN 61 PRIVATE EQUITY Burn Holdings has three subsidiaries, the year ending September 2014 are JPY7.4 billion secondary exits since 2011 – more than the largest of which is Burn Repair, a final-touch repair and JPY500 million, respectively. Earnings growth combined total for the 10 years before that. This service used by homebuilders and construction is said to have contributed about 70% of J-Star’s surge in activity can largely be traced back to materials manufacturers to clean up properties overall return on the investment. buyouts from the years leading up the global post-construction and pre-sale. This function was The PE firm’s operational contribution fell into financial crisis. Investors want to exit, and with previously fulfilled by small local three categories. First, it formed weak public markets and uncertainty among contractors, but as developers a holding company structure strategic players, secondaries are a welcome began to work on larger projects for the various subsidiaries in source of liquidity. an opening emerged for a large- order to improve governance For J-Star, which completed its first-ever scale provider. and operating efficiency. Second, secondary exit last week, selling to another There are 30 Burn Repair headcount increased from 524 PE investor was a practical necessity. Repair outlets nationwide. It also to 783 and an mentor system business Burn Holdings was keen to retain its provides post-sale services such was used to reduce turnover. independence, so despite interest from a number as property inspections. Burn Burn Repair: Finishing touch Third, steps were taken to boost of strategic buyers, the PE firm opted to sell its Holdings’ other businesses, profitability. “We introduced majority stake to two financial players – Shinsei HouseBox and Spec, sell repair materials and offer information systems and set key performance Corporate Investment and Creation Capital. interior finishing services. indicators,” says Hara. “This was important Beyond that, the rationale was fairly standard. J-Star acquired a majority stake in the because prior to our investment the company “We are a solution capital provider. When we company for around $5 million in 2011. Founder focused on everything, whether profitable or not. Wider reach to everyone in your organisation invested the solution required was coming Akio Hayashi held on to a minority interest and After our investment, the focus switched to the up with a concrete holding structure so the he remains an investor under the new ownership. earnings contribution of different businesses.” subsidiaries could function and to focus on Burn Holdings recorded sales of JPY4.7 billion As to what Shinsei and Creation will focus on, improving earnings,” explains Greg Hara, J-Star’s ($43 million) in 2011 and EBITDA of just under Burn Holdings is ultimately seen as a likely IPO avcj.com site licence allows everyone in your organisation to have instant access to in-depth analysis, president. “These have been achieved.” JPY200 million. Forecast sales and EBITDA for the candidate. real-time news and information on private equity in Asia and beyond. Sign up for an avcj.com site licence now and empower your team with critical information and data to soar above your competitors in Asian private equity: Sinarmas takes Ardent cross-border Access up-to-date news on Asia’s private equity market Track the latest trends in fund raising, investments, exits and capital under management ARDENT CAPITAL IS REGISTERED IN HONG While Ardent has a VC business that backs conglomerate’s existing resources in industries Learn of new mergers, acquisitions and business alliances Kong, but Bangkok remains its home. Previous existing start-ups, the Labs division tests that span agribusiness, pulp and paper, real investments by the VC firm have followed the promising business ideas and seeds them with estate, telecom and financial services. The VC Undertake investment and risk assessment same model – start in Thailand, then expand into a few thousand dollars. Once the nascent firm will also open a new office in a five-floor Assess the e ects of global developments on a specic region or country other Southeast Asian markets. Now, though, company starts acquiring customers, it receives building owned by Sinarmas and hire about 20 Ardent is preparing to incubate ideas out of $500,000; and then a further $1-2 employees. Understand changes in the regulatory environment Indonesia as well. million before the Series A round, Ardent differs from traditional Get business intelligence on major deals Last week, the firm received $12.5 million which includes outside investors, venture capital firms in that in funding, 90% of which was provided by kicks in. it doesn’t raise funds to make Swiftly and accurately identify potential business opportunities Indonesian conglomerate Sinarmas. It follows “We always build companies investments. Rather, it operates a $4.5 million round – Ardent’s first external big enough to raise a scalable under a holding company funding – last year. Series A round,” says Vanzyl. model, similar to Germany- How does it work? “We realized last year that Indonesia will be a “Acommerce is a good example. Creative zone: Ardent Labs based Rocket Internet. Ardent key growth market in Southeast Asia in terms of Its latest round was one of the holds 100% of every company it We will arrange online access for your employees to avcj.com, either with individual passwords or by general population size and investment opportunities,” largest Series A ever seen in Southeast Asia.” founds and generates returns through trade sale says Adrian Vanzyl, Ardent’s CEO. “We met Ardent intends to use the same methodology or IPO exits. Investors in the holding company – access through IP address recognition. Sinarmas through aCommerce and we know to launch Indonesia-based start-ups and then like Sinarmas – receive proceeds based on their each other well. We think that they can help us help them expand into Thailand. Investments individual holdings. expand into the country.” will be made across four areas: sourcing and “Compared to traditional VC firms, our model How much does it cost? ACommerce is a logistics provider launched management, fulfillment and logistics, retail, and is much more capital efficient but it’s also much by Ardent Labs, which operates much like a VC customer acquisition. These four areas comprise higher risk. We make bigger bets on fewer That depends on how much access you want, but we can customise cost-e ective packages to all rms, regard- accelerator. In June it received $10.7 million in what Ardent refers to as an “e-commerce stack.” companies, which means we really have to Series A funding led by Inspire Ventures. Sinarmas With Sinarmas on board as a strategic support and guide them to be successful,” says less of size. For more information, contact Sally Yip at +(852) 3411 4921 or email also took part. investor, Ardent is expected to leverage the Vanzyl. [email protected] and we will be happy to discuss with you.

Number 36 | Volume 27 | September 30 2014 | avcj.com 13 FOCUS [email protected] Back from the brink? Moves by Japan’s Nomura Asset Management and Singaporean lender OCBC to enter Chinese private equity through the Qualified Foreign Limited Partnership program are unlikely to spark a broader revival

PRIVATE EQUITY IS HARDLY NOMURA Nomura’s core business is managing listed Another factor behind the foray into PE is Asset Management’s core business but two securities. It has been investing in China’s A-share demand from domestic investors that want weeks ago the Japanese firm announced the market for several years through the Qualified to deploy capital overseas. It has prompted launch of a fund in China. Foreign Institutional Investor (QFII) scheme. several large local financial institutions to try and Having received a license to operate under The slowdown in the A-share market has diversify business lines. the Qualified Foreign Limited Partnership (QFLP) seen international mutual fund managers’ local “There is an increasing amount of capital program, Nomura set up a 50-50 joint venture joint ventures lose traction. These enterprises being allocated into alternative asset classes in with a local fund manager Shenzhen Hua Xia Ren also have a structural failing. Foreign ownership Japan, such as private equity. At the same time, He Capital Management in Shenzhen’s Qianhai is capped at 49% stake and this has enabled the China is liberalizing its capital markets. If you Economic Zone. local partner to wield more power, often pushing put these two trends together, it would suggest The move comes after Singapore-based OCBC the foreign player into a financial advisory role. that local fund managers like Nomura will be Bank launched a $100 million PE fund under the “Global asset managers may not have much attracted to private equity,” says Dean Moroz, QFLP program in Shanghai earlier this year. It influence over how the business develops,” says Hong Kong-based legal counsel at Ashurst. represents a reawakening of interest in onshore Ivan Shi, research director at Shanghai-based Nomura wants to raise capital from Asian private equity funds among foreign investors high net worth individuals and sovereign wealth following a couple of years of relative inactivity. funds, as well as from investors in the US and Why is it happening? “International firms Europe, but this is no easy task. Moroz cautions “Public market funds in mainland China have that mutual fund managers are hardly likely to be not performed well, especially after the financial won’t bother to apply the first port of call for pension funds that want crisis. However, there is a huge growth in the for the quotas if they to invest in private equity. private markets,” says Nakano Hiroyuki, a Nomura Nomura says it will address this by having spokesperson. “We really think PE assets could are still going to be Shenzhen Hua Xia Ren to bring in capital from reflect the actual growth of Chinese economy. Chinese investors. The company was founded by We want to launch PE fund products to high net treated as foreign ex-employees of China Asset Management, one of worth individuals and capture this growth.” China’s biggest mutual fund management firms. investors” – Flora Qian As to how and where the joint venture will Broken dreams invest, the plan is to back late-stage private The QFLP program was introduced in 2011, consultancy Z-ben Advisors. “Because of the companies through the acquisition of minority allowing foreign capital to be channeled more weak demand for mutual fund products in recent and controlling stakes. There will also be PIPE easily into renminbi-denominated vehicles. years, a few international groups – in particular deals. Nomura’s Hiroyuki emphasizes the ultimate More than 20 private equity firms, including The those set up in China within the last three years – aim is to create a wider range of products for Blackstone Group and The Carlyle Group, soon are winding down their joint ventures.” investors – in the private equity and secondary applied for the quotas and launched funds. By comparison, the growth prospects for PE markets as well as through the construction of It was hoped that these vehicles would appear strong. Industry participants point to the diversified A-share portfolio. be treated as local entities, removing the government’s pledge to restructure state-owned For OCBC, the strategy is to invest in privately- bureaucracy that restricts offshore funds. enterprises, which could lead to more PE deal owned growth-stage companies with aspirations Shanghai went as far as to say that local flow, and announcements by local governments to list on the A-share market. Sectors such as treatment would apply if less than 5% of these to boost internationalization of the renminbi and modern agriculture, consumer, healthcare, clean funds’ total corpus came from overseas. However, cross-border investments. Foreign PE firms are and environmental technology and advanced the regulators vetoed the move – all foreign- setting up in Qianhai and Shanghai’s Free Trade manufacturing are of particular interest. invested funds would be treated as foreign. Zone in anticipation of a breakthrough. Each firm sees PE as part of a broader effort “From our observation, QFLP isn’t as popular Nomura’s investment banking division, to develop its exposure to other financial as two years ago. International firms won’t bother Nomura Holdings, has already established businesses. But are industry participants are to apply for the quotas if they are still going to another JV in the Shanghai Free Trade Zone. It cautious as to whether this can inspire other be treated as foreign investors,” says Flora Qian, will own 60% of the venture, with the rest held foreign institutions to play a larger role in QFLP. Hong Kong-based legal counsel at Fangda Law. by two local investors. The JV cannot sell financial After all, the Blackstone local treatment issue has “Fund managers may need to get Ministry of products directly to Chinese clients, but it can yet to be resolved. Commerce approval for every transaction, just offer products and advice to the retail operation “From a commercial perspective, I don’t see a like every other foreign investor in China.” of the local partner. Hiroyuki says Nomura will lot of fund managers following suit because the The key point is that Nomura and OCBC are look for ways in which the PE and investment program doesn’t provide any significant benefits no Blackstone or Carlyle. OCBC is a bank while banking JVs can work together. to investing in China,” says Fangda’s Qian.

14 avcj.com | September 30 2014 | Volume 27 | Number 36 LP INTERVIEW [email protected] Going global Malaysian pension fund KWAP is adding North America and European exposure to its Asia-heavy private equity portfolio. It is ramping up commitments from a relatively low base

RECENT PRIVATE EQUITY FUND asset allocation that will see KWAP’s international “We are still a small player in this global commitments made by Kumpulan Wang investments rise from 10% of the portfolio to industry,” Amlizan says. “However we believe that Persaraan (KWAP), Malaysia’s second-biggest around 19%. As a result, the 1% PE allocation has it is critical to build our presence in the industry pension fund, point to an LP in transition. jumped to 2%, with a further 1% for infrastructure. in order to participate in high-performing global Each of the nine managers it backed between KWAP will deploy 6% in overseas equities, 5% in funds. In most cases, when top-performing GPs 2010 and 2012 are concentrated on Asia: from fixed income securities and 6% in real estate. raise their subsequent fund, existing LPs re-up Saratoga Capital and Ancora Capital in Indonesia Based on the annual average increase in with a higher capital commitment. New LPs to Advent Private Capital in Australia to the fund size over the past five years, KWAP will may not have the opportunity to invest unless Southeast Asia-heavy offerings of Asiasons and have MYR113.9 billion under management by they are we well known, reputable institutional Lombard Asia. the end of 2014, of which up to MYR3.4 billion investors.” Last year, there was one big Asia investment could theoretically be in private equity and The second is attracting talent capable – KWAP backed Affinity Equity’s Partners’ fourth infrastructure. of executing the pension fund’s investment fund, its first commitment to a large regional strategy. Malaysia is an immature private equity buyout vehicle – but the other three were Growing appetite market relative to the likes of the US and far from home. Acon Equity Partners III and KWAP’s origins lie in the Pensions Trust Fund this makes it difficult to recruit professionals Stonepeak Infrastructure Fund are both North established by the government in 1991 to cover who can source deals and funds. KWAP’s America-focused, while Nordic Capital III mainly federal pension liability. Under new legislation alternatives department is growing fast, with invests in Sweden, Denmark, Finland and Norway. introduced in 2007, KWAP was incorporated and nine professionals in private equity, covering “Our private equity fund program has gained assumed responsibility for the Pensions Trust both the investment and portfolio management, momentum in terms of both geographical and Fund. It receives contributions from 505 statutory and others responsible for real estate, but the program is currently managed internally. KWAP private equity fund commitments, 2010-2013 “If you are going to fast track a program you can appoint an advisor to assist in your Year Fund Geographic focus portfolio construction and build up, but we 2010 Ancora Fund II Indonesia decided to do it ourselves,” Amlizan explains. “We Asia Water Fund Asia might consider using advisors in the future to CIMB-TrustCapital Australia Office Fund No.1 Australia complement our in house investment program.” Tata Capital Growth Fund India This team is already working on geographic 2011 Saratoga Asia III Indonesia and sector diversification, with co-investment DragonRider Opportunity Fund II China; SE Asia seen as the next step. Some deals are already Advent VI Australia; New Zealand in the pipeline. Co-investment is one area of Templeton Strategic Emerging Market IV Europe; SE Asia; China; India consideration when KWAP invests in a fund; 2012 Lombard Asia IV SE Asia another is an observer seat, which presents 2013 Acon Equity Partners III North America the team with an opportunity to learn from its Affinity Asia Pacific Fund IV Asia partner GPs and augment internal capabilities. Stonepeak Infrastructure Fund North America As to the kind of managers KWAP is targeting, Nordic Capital VIII Nordic region large-cap players such as Affinity appear to be the Source: KWAP exception rather than the rule. Acon Investments fund strategy diversification in recent years,” says bodies, local authorities and agencies that and Nordic Capital, well-established mid-market Nik Amlizan Binti Mohamed, KWAP’s CIO. “Last together have more than 160,000 members, plus players in their respective geographies, arguably year we invested in four funds including a US additional funding from the government. serve as a better indicator of what the pension infrastructure and a European buyout fund. As The first private equity fund investment came fund is looking at. In addition to offering an of the third quarter of this year, we have closed in 2001 but until incorporation commitments element of diversification to an Asia-heavy three funds, including one global secondaries tended to be opportunistic and relatively small. portfolio, mid-market buyouts in developed fund. We aim for 4-5 funds per year.” In recent years, KWAP’s commitment for a fund markets are seen as strong performers. The pension fund had 18 GP relationships has grown from $20 million to $50 million. “The focus in the medium-term is more of at the end of 2013 and MYR816 million ($249 Aside from picking the right managers the mid-market funds where returns have been million) devoted to the asset class out of a total – a challenge for all LPs, irrespective of size the strongest,” Amlizan says. “We aren’t going to portfolio of MYR99.9 billion. It also had two direct – KWAP faces two key pressures as it builds focus so much on the mega funds, although if a private equity investments in Malaysia. Last year, out its alternatives program. The first is brand manager has consistently delivered well in this the Ministry of Finance approved a new strategic recognition. space then we would consider them.”

Number 36 | Volume 27 | September 30 2014 | avcj.com 15 AVCJ Private Equity & Venture Capital Awards – Asia Nominations open until 3 October 2014. ACT NOW!

Held in conjunction with the AVCJ Forum and now in their RECOGNISING EXCELLENCE 14th year, the AVCJ Awards have become the highest IN ASIAN PRIVATE EQUITY distinction that can be achieved in private equity in Asia, and a showcase for first-class innovation, ingenuity and performance. Tell us who you think deserves recognition. Submissions for nominations are open now until 3 October, 2014. Visit www.avcjforum.com/ nominations and fill out the form. For any enquiries, please e-mail [email protected]

The Awards categories ◗ Fundraising of the Year - Venture Capital ◗ Exit of the Year - Mid Cap ◗ Fundraising of the Year - Mid Cap ◗ Exit of the Year - Large Cap ◗ Fundraising of the Year - Large Cap ◗ Venture Capital Professional of the Year ◗ Deal of the Year - Venture Capital ◗ Private Equity Professional of the Year ◗ Deal of the Year - Mid Cap ◗ Operational Value Add Award ◗ Deal of the Year - Large Cap ◗ Firm of the Year ◗ Exit of the Year - IPO ◗ AVCJ Special Achievement Award

ASSOCIATE YOUR BRAND WITH EXCELLENCE: If you would like to be associated with recognising and Sponsored by rewarding excellence within the Asian private equity industry, award sponsorship opportunities are available. For more information, please contact Samuel Lau on +852 3411 4963 or [email protected]