Category: Investment
Temasek unit Heliconia launches US$422 million International Partnership Fund to help Singaporean firms expand globally
Heliconia Capital Management, a unit of Temasek Holdings, has announced the launch of a S$600 million (about US$422 million) International Partnership Fund (IPF) in government capital.
The new fund will be used to co-invest with Singapore-based enterprises, helping local enterprises to internationalise their business operations and expanding into oversea markets via acquisitions.
Its joint investment policy focuses on Asian markets, encouraging local firms to partner with other Asian companies to engage in activities such as extending product lines, brands or value chains, in addition to gaining access to markets, channels, and technologies.
Specifically, the fund will support firms that intend to grow by acquiring their regional peers, but which may not have sufficient capital to proceed with its acquisition.
In this way, the fund will hold opportunities for smaller local firms by allowing them to link up with Heliconia as a consortium partner that is able to co-invest in the target company alongside the Singapore acquirer.
Heliconia will come in purely as a financial investor and will not compete over the acquisition’s ownership. Firms that have not identified an acquisition target can also opt for Heliconia’s help to source deals by tapping its extended networks, which only large private equity funds can maintain.
However, to draw on the funds, firms must meet the criteria of being headquartered in the city-state and to have post annual revenues no higher than S$800 million ($564 million). These conditions place their investment focus firmly on middle market enterprises.
“The creation of the fund is part of an effort to develop a smart financing ecosystem here, in Singapore,” said Finance Minister Heng Swee Keat. “More funding support is also being targeted at infrastructure developers to help them undertake more oversea projects.”
By Vivian Foo, Unicorn Media
China’s JoyMe, Kee Ever to set up US$360 million M&A fund to acquire oversea video game companies
JoyMe Group, a Beijing-based internet technology company has formed a strategic alliance with Kee Ever Bright Decorative Technology Co., Ltd., a Jiangsu province-based online video game company to launch a RMB3 billion (about US$360 million) video game M&A fund.
The first phase of the fund, tentatively set at RMB1 billion (about US$140 million) will focus on the investment of video games distribution, production, development, eSports, and other industries which lie in line with the development strategy of the two investment partners.
In 2016, the video game market in China was estimated to worth RMB165 billion (about US$24 billion), in addition to an emerging trend in merger and acquisition, recording a total of US$28 billion transaction value in the same year. This can be seen looking at Tencent Holdings Ltd’s US$8.6 billion acquisition of Finland-based mobile game development company Supercell and Youzu Interactive’s €80 million acquisition of German game business Bigpoint, among some.
“The global video games industry has a history of over 50 years, and China’s gaming market has its own three eras whereby, in the beginning, companies like Sdo and The9 only aim to become the proxy of a good product. Later, a new batch of companies emerged which set research and development at its core. Today, the situation has transitioned to that of Tencent and Netease, whereby internationalisation becomes the driving force of most gaming companies,” said Chen Yang, the CEO and Group Chairman of JoyMe.
“Hence, it is time for us to launch a buyout fund targeting the international market. As comparing China to other countries, we are lacking in terms of technology and creativity although China’s game industry market has an edge in its user base, paying capacity as well as commercial capacity of Chinese companies which can leverage global attention. In this case, we intend to acquire the best foreign products and talents back to China,” said Chen Yang.
Founded in 2011 by Chen Yang, a former lead producer at U.S.-based Electronic Arts Inc. The company previously raised a RMB130 million (about US$18 million) series B round from Fosun Kinzon Capital and Bluerun Ventures. It later raised an undisclosed amount of series C round from online video platform Youku Tudou and Beijing-based game developer Ourpalm.
Prior to the establishment of investment funds, the Group has formed a North American branch and which was joined by former Lucas Entertainment CEO Jack Sorensen and other senior players. In this retrospect, Chen Yang said that compared to other teams, their team’s advantage lies in understanding the North American market, “our team in the international large-scale game companies who have a lot of executives, including myself is the case.”
Speaking on the future of the group for the game industry layout, Chen Yang said, “We will not acquire studios at their early stages, as though their game content development may be creative, at the same time, there are still many uncertainties. Moreover, this fund sets out to be an M&A fund instead of being a VC, hence game companies model which has not been proven in the market will not be included in our investment scope.”
By Vivian Foo, Next Unicorn
CapBridge and Gordian Capital to launch US$100 million rules-based CapBridge Investment Trust to invest in private securities
Singaporean CapBridge and investment manager Gordian Capital has formed a partnership to launch a pre-IPO fund – the first sub-trust fund in a series of CapBridge Investment Trust which is said to be a rules-based trust investing in private securities.
The pre-IPO Fund is targeting a US$100 million fresh capital to provide growth-stage startups and pre-IPO companies an opportunity to tap into additional funding as well as to provide accredited and institutional investors a greater access to venture capital-level returns.
CapBridge’s Co-founder and CEO Steven Fang explained, “Venture Capital consistently outperforms other asset classes and has some of the best returns in the investment industry. Traditionally, accredited and institutional investors have had limited access to these venture capital-backed growth companies.”
Established in 2015, CapBridge is an online capital-raising platform that enables institutional and accredited investors to invest in growth-stage enterprises companies via venture capital financing and pre-IPO placement. The firm has also formed partnerships with the SGX and Clearbridge Accelerator.
“While rules-based processes are applied in the trading of publicly-listed investments, this is the first time, as far as we know, that a rules-based structure is being applied to investments in venture-backed securities issued by private companies,” said Dr. Steven Fang.
“Given the efficiency of a rules-based trust structure, we believe that the Pre-IPO Fund has the potential to expedite pre-IPO capital raising, making Singapore an attractive fundraising destination for growth companies,” he further adds.
In a way, CIT enables qualified institutional and accredited investors the access to quality, diversified portfolios in a cost-efficient and effective manner with no management fee to carry. Over the next five years, the platform will target investments in venture-backed enterprises in pre-IPO investments.
The fund following a rules-based structure is typically defined as a fund that aims to generate exposure to a to a specific segment of the equities market but operates without consideration of stock market capitalisation or portfolio weighting. In the case of CIT’s Pre-IPO Fund, it is aimed is to increase exposure to securities issued by growth-stage companies.
“The rules-based nature of CIT ‘automates’ the selection criteria and removes the need for active discretionary management, which reduces the fund’s expense load,” Steven Fang explains.
The Pre-IPO Fund will also invest exclusively in convertible instruments issued by companies curated on the CapBridge platform. This will allow the company to preserve capital and maximise returns, allowing for a measure of downside capital protection and potential capital gains.
Commenting on the deal, Mark Voumard, the Founder and CEO of Gordian Capital Singapore Pte. Ltd said, “We are delighted to be working with CapBridge to help support the venture capital ecosystem in Singapore.”
By Vivian Foo, Unicorn Media
Mobvista secures US$100 million credit facility from Bank of China
China’s mobile marketing platform Mobvista Co. Ltd. has on Wednesday, obtained a credit facility worth nearly US$100 million from Bank of China, which marks the largest credit facility ever granted by a bank in the mobile marketing industry in China.
“For an asset-light Internet company, the trust behind the strategic cooperation with Bank of China wasn’t easy to build,” said Mobvista’s Founder and CEO Wei Duan. “The credit facility represents not only Bank of China’s recognition of Mobvista’s past performance, but also its confidence on Mobvista’s future.”
Established in 2013, Mobvista is an Asian mobile marketing platform that focuses on providing user acquisition and traffic monetization services to mobile app developers across the world. On November 2015, the company completed its listing on China’s National Equities Exchange and Quotations (NEEQ), raising an amount of nearly US$1 billion.
Mobvista is also recognized by TUNE as the “Top 25 Mobile Advertising Partner Report for 2016“, having targeted traffic from 243 countries and regions with a daily amount reaching over 10 billion. Prior to this, the company which houses 500 employees in 12 offices spread across the world is backed by NetEase (Hong Kong) Ltd., Midas Capital, Shanghai Media Group, Haitong Securities and China Securities,
In May 2016, the company raised nearly US$80 million via its first private placement deal to finance acquisitions, buying U.S. advertising company NativeX and European mobile game analytics platform GameAnalytics for an undisclosed amount in February and July last year.
“Across the world, over 80% Internet users are connected via smartphones and the rapid growth mobile Internet over the past three years offers historic opportunities to global mobile marketing industry. This credit facility from Bank of China will further help us accelerate expansion in overseas markets,” said Wei Duan
Mobvista’s revenue reached US$118.174 million while its net profit reached US$11.525 million for the six months ended on August 31, 2016, according to disclosure filings, in which has allowed it to maintain its No.1 position in the mobile marketing industry.
Providing financial services in China and 46 other countries and regions, Bank of China within the three years period from 2012 to 2015, has increased its overseas assets by 54.06% and continued to diversify, strongly supporting its cross-border M&As and M&A financing and loan businesses in the trend to internationalise.
“Mobile marketing is an emerging industry with great momentum. Today’s credit facility is based on the recognition to the mobile marketing industry, which is in line with Bank of China’s commitment to an efficient and professional partner addressing all demands of small and medium businesses,” said a spokesperson from the Bank of China.
Bank of China is Mobvista’s largest bank partner in 2016 looking at the perspectives of RMB deposit and loans, USD loans, as well as cross-border settlement. With the support from Guangdong Branch of Bank of China, Mobvista has built a connection with Bank of China’s branches in Seoul, Brussels, Hong Kong, New York and Chicago.
From Vivian Foo, Unicorn Media
China Media Capital, SECA to invest tens of millions of Euros in FIA Formula E Championship
Chinese private equity firm China Media Capital (CMC), led by Chinese media mogul Li Ruigang, announced on Tuesday that it has partnered with its portfolio company SECA, a sports marketing company in China to invest tens of millions of Euros into Formula E Holdings, the official promoter of the FIA Formula E Championship auto racing.
Financial details of the transaction were not disclosed but CMC and SECA plan to help introduce and expand Formula E’s influence in China.
Established in 2014, the Formula E Championship is the world’s first electric powered single-seater racing series featuring electric-powered cars manufactured by makers including Renault, Jaguar, and Mahindra racing in major cities around the world.
Its third season, which started in October and runs until July, comprised of races in cities such as Mexico City, Hong Kong, Paris, Berlin, Brussels, New York, and Montreal. According to Formula E, its Hong Kong race in 2016 was watched by 488,000 Chinese viewers via the internet.
“The opening round of each season has been hosted in this region – Beijing and Hong Kong – and we have teams and drivers such as TECHEETAH and Ma Qing Hua already competing in the series. We look forward to working closely with CMC Capital Partners, and continuing to grow the profile of Formula E in key territories across the globe,” Alejandro Agag, the Founder & CEO of Formula E, said.
Formula E has also established partnerships with Chinese TV stations and online video sites including Chinese national television operator CCTV and online video platform iQiyi.com to broadcast races in China.
“Since its inauguration three years ago, Formula E has quickly evolved into a premium global sports IP under a first-class leadership, with remarkable progress in promoting sustainability, innovation, and market penetration of electric vehicles, as well as in media partnership, sponsorship, and tourism,” Li Ruigang said.
“CMC has been focusing on investing in premium global and local sports IPs, and we look forward to working together with Formula E both in China and globally,” he further adds.
The investment in Formula E follows a series of investments made by CMC and its affiliates in sports companies, including SoccerWorld China, Lanxiong Sports, and Beijing Wesai Era Sports Technology Co. This also includes leading an angel round in a sports content startup founded by Chinese football celebrity Sun Jihai in December,
In 2015, CMC and CITIC Capital agreed to invest US$400 million for the acquisition of a 13% of City Football Group, the owner of football related clubs and businesses including Manchester City, New York City, Melbourne City, and a minority shareholder in Japanese football association Yokohama F. Marinos.
Founded in 2009, CMC was the mainland’s first media sector focused fund dedicated to media and entertainment investments in China and around the world. It has separate movie-making ventures with IMAX Corp and Warner Brothers Entertainment, as well as a partnership with Jeffrey Katzenberg’s Dreamworks Animation Skg, which produced Kung Fu Panda 3.
The company signed a deal in October 2015 for the exclusive global broadcast rights over the next five years of Chinese Super League,
Commenting on the fundraising, Agag said, “We are excited to welcome CMC Capital Partners, led by Mr. Ruigang Li, to the increasing list of investors joining Formula E and the electric revolution. China is an important player in the potential of electric vehicle manufacturing and production, and this partnership reinforces our intentions to promote sustainable mobility across Asia and Mainland China.”
By Vivian Foo, Unicorn Media