Shanghai-headquartered private equity firm SinoLatin Capital has been given the go-ahead to raise and manage RMB-denominated private equity funds by the Shanghai-Pudong government authorities.
The firm is now in the process of preparing legal and regulatory documentation, Luis Gómez Cobo, a founding partner at SinoLatin Capital, told PEI Asia in an interview. The firm will target commitments of between $300 million to $500 million in RMB.
SinoLatin is a financial advisory and principal investment firm focused on cross-border transactions between China and Latin America. It is the only Latin America-focused firm to have been granted a license to manage RMB-denominated private equity funds in China, the firm said in a statement.
The firm acquires majority or minority stakes in Latin American natural resource companies where it can add value by linking the investment to China. It invests in private companies, spin-offs of larger companies, start-up projects and other special purpose vehicles used to acquire commodities assets in Latin America.
This is the first time the firm will manage third-party capital in the structure of a private equity fund. SinoLatin is also open to co-investment opportunities with Chinese institutional investors, Cobo said.
The firm will look to invest in both Latin America and China from its RMB fund, although its mandate will be dependent on Chinese regulations, Cobo said. The primary focus is on investments in Latin America in three sectors: mining; agribusiness and forestry; and energy.
SinoLatin is simultaneously in the process of setting up a USD-denominated fund focused on the same sectors in Latin America. That fund will also target commitments of between $300 million and $500 million, Cobo said.
“We are deeply appreciative and proud to have been granted this license, which signals the Chinese government’s support for our efforts to promote and expand the country’s investment relationship with Latin America,” Cobo said in a statement.