StepStone, AB Value lead CDIB's China-focused continuation fund

StepStone, AB Value lead CDIB's China-focused continuation fund

Photo: Bloomberg

Asian private equity (PE) and asset manager CDIB Capital Group (CDIB) has announced the final close of its Greater China-focused continuation PE vehicle, CDIB NexGen Partners Fund.

The announcement did not disclose the total of commitments that the PE firm secured for the vehicle focused on mid-market buyouts across Greater China.

CDIB, however, said the fund secured commitments from a roster of global institutional backers including StepStone Group and AB Value Capital Partners.

A recent report by Secondaries Investor indicates that the continuation fund will enable CDIB to maintain its ownership in two existing portfolio companies: Poyun, a voice mail manufacturer with operations in China and Vietnam, and PT MedTech, a Chinese medical device producer.

CDIB acquired Poyun in 2021 and MedTech in 2022.

The firm’s president, Melanie Nan, said the closing underscores investor confidence in the firm’s investment strategy, track record, and regional expertise.

The fund aims to capitalise on generational shifts and industry consolidation in Asia’s advanced manufacturing sectors, leveraging CDIB’s local network and operational insights.

Alex Ying, head of the Buyout Group at CDIB, said the milestone underscores a collective aim to foster value creation and transformative businesses in Greater China.

CDIB said the fund will continue to pursue mid-market targets demonstrating robust growth potential, with the firm’s broader strategy emphasising local market relationships and an active, value-added management approach.

No financial details of the fund’s size or specific investment targets were disclosed.

US investment group StepStone, which recently opened an office in Singapore, provided a significant commitment, per the announcement.

Vincent Hsu, partner of private equity Asia, at StepStone, said the fund’s emphasis on mid-market buyouts aligns with StepStone’s strategy of supporting differentiated managers in Asia.

StepStone manages $659 billion in assets under management and advisement as of September 2023. APAC-based clients account for around 20% of the group’s management and advisory fees.

In Southeast Asia, it remains unclear whether the region is ready for continuation funds given that fund managers still lack a proven track record and that assets are varied.

Recently, Indonesian venture capital firm East Ventures closed its inaugural continuation fund underwritten by secondary specialist Coller Capital.

The GP-led transaction was designed for East Venture’s fifth seed fund, bringing the total distributions-to-paid in capital (DPI) of the fund to approximately 2x, the company said.

Edited by: Padma Priya

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