PE firms have plenty of opportunities in China in 2015

A State Council (cabinet) executive meeting held on Dec 3, which was presided over by Premier Li Keqiang, said that the pilot support policies being offered in the Zhongguancun Science Park in Beijing will be expanded to other regions of China.

China is also upgrading its traditional sectors and adjusting its economic structure. Those moves are prompting corporate innovation.

As for the Chinese PE sector in 2014, the challenges included financing pressure on investment funds and difficulties operating companies in which PE firms had investments, said Shan.According to Zero2IPO Group, 2,765 private equity (including venture capital) deals were made in the first 11 months of 2014. The total value was $66 billion, up 112 percent on the full year of 2013.

Highlights in 2014 included the resumption of A-share IPOs and the emergence of new PE firms, Zero2IPO said.

Internet giants, listed companies, financial institutions and central and local governments have been taking part in PE investment.

Li Weiqun, secretary-general of China Association of Private Equity, said that starting 1967, the year in which the global PE sector was born, the industry experienced three cycles.

The sector entered a fourth cycle in 2014 that will provide profits over the next five to 10 years. The internationalization of the yuan will help Chinese PE and VC investors pursue deals and technology abroad, said Li.