Deals

Harvest Capital raises first fund following expansion

Eight months after igniting plans to expand its investment horizons to other areas of private equity, the China Resources-owned platform has hauled RMB956 million from Chinese investors for a fund wrapped around a residential development in Shanghai.

Jonathan Brasse -

6 February 2013

Harvest Capital Partners, the Hong Kong-based private equity business of Chinese state-owned conglomerate China Resources, has raised and closed its first real estate fund since embarking on a plan to expand its investment horizon last year.

Harvest Capital, part of China Resources’ financial services subsidiary China Resources Capital (CR Capital), has raised RMB956 million (€112.54 million; $153.36 million) for a joint venture fund with another China Resources company, the residential developer China Vanke, to back a prime development in Hongqiao, Shanghai. Harvest Capital will be the vehicle’s general partner and fund manager in collaboration with another affiliate, the investment management platform China Resources SZITIC Trust.

In an announcement on the fundraising, CR Capital said the capital raising was a “breakthrough” by Harvest Capital into the RMB fund space following a history of raising US dollar-denominated funds. The firm added that the fund “received overwhelming market response” and was more than twice oversubscribed within just two weeks of its launch.

The fundraising comes approximately eight months after the firm expanded its investment horizon from real estate to other private equity asset classes. That expansion led to the departure of its original chief executive officer and founder Rong Ren and others from the firm’s staff. Some joined Ren at similarly-titled Harvest Real Estate Investments, a new private equity real estate firm co-sponsored by London-based Grosvenor Fund Management and China’s second largest asset manager, Harvest Fund Management.

Jiang Wei, chairman of CR Capital and Ren’s replacement as chief executive officer of Harvest Capital, said: “This is a breakthrough for Harvest Capital as we leverage our outstanding investment management track record in US dollar funds to expand into RMB funds.” He added: “The launch of our first RMB fund is an important step forward as we continue to develop into a multi-strategy and cross-industry fund manager.”