Cathay launches €200-250m Sino-French Innovation fund

José Rojo
02 July 2015

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Cathay Capital Private Equity has launched the Sino-French Innovation fund, with commitments already secured from BPI France and the China Development Bank.

According to Cathay, the Sino-French Innovation fund was launched on 30 June with a target in the region of €200-250m and a hard-cap sitting at the upper end of that bracket.

The GP, targeting a first close for the end of August, expects to raise €100-150m of that target from BPI France and China Development Bank (CDB) Capital. Meanwhile, remaining commitments will come from investors and entrepreneurs from the Asian, France and North American technology sector.

Clifford Chance partner Xavier Comaills is currently providing legal advice for the fundraising process.

This is the third time both state-funded investment arms have become LPs in a Cathay-managed vehicle focusing on the Chinese and French markets. In September 2012, the GP announced the launch of Franco-Chinese Fund, targeting €5-15m growth capital deals in France- and China-based SMEs.

The vehicle was followed by Sino French Midcap Fund, which reached its €500m hard-cap in December 2014, six months after launch. The fundraising process saw BPI France and CDB each commit €100m and become cornerstone investors of a 30-strong LP base, according to unquote" data.

Investments
The Sino-French Innovation Fund will invest equity tickets of €5-25m in digital start-ups such as software and videogame developers, advertising and digital marketing agencies, big data and internet-of-things businesses, as well as social media companies.

According to Cathay, the fund will be used to finance 12-18 deals over its lifespan. The vehicle's geographic focus will cover both France and China, with a small number of investments going to US companies. No investments have been carried out for the time being.

People
Nicolas Dufourcq is BPI France's managing director, while Hu Huaibang is CEO of CDB. Cathay Capital Private Equity, represented by CEO Mingpo Cai, plans to assemble a dedicated team for the fund via new hires.