The Fund will leverage its relationships with public institutions, companies, family offices, strategic partners to generate attractive and differentiated deal flow for Sub-Fund I. On the primary side, the Fund will invest in companies with strong (actual or potential) competitive positions across a variety of sectors that exhibit attractive characteristics, including but not limited to large total market size, secular growth driven by sustainable drivers, stable industry structure and limited exposure to exogenous risks (economic, technological, political, regulatory). The Fund has identified and prioritized the media/entertainment, technology and clean energy sectors and has developed an active pipeline of readily actionable target investments in these sectors.
On the co-investment front, the Fund will target businesses and industries with similar characteristics to the primary side, whilst investing alongside reputable private equity firms and strategic partners in such companies. The Fund will ensure that it invests on similar terms to its co-investment partners with shared governance rights. The Fund believes that a flexible investment mandate that combines primary investments and co-investments will allow it to capitalize on the most attractive opportunities whilst deploying capital at scale. The Fund recognizes that as the Asian private equity market evolves, firms with geographic and sector specialization will emerge, and investing selectively alongside them is a potentially valuable source of deal f low.
For both the primary and co-investment strategies, the Fund’s key competitive advantage is the breadth of its relationships with leading institutions and companies in the region, which allow it to access proprietary high quality deal flow.
The Fund intends to exploit the J-Curve which is widely referred to in private equity capital as the graphical representation of historical tendencies for funds to deliver low returns in early years, and then rapidly accelerating investment gains in the outlying years as the portfolio of companies matures and valuations increase.
The Fund’s due diligence process and ability to evaluate opportunities allow us to uncover the right investments that may have strong strategy, management team, or investor blend. In such companies there has often been a significant investment, typically in the tens of millions of dollars over time. Typically, these companies are well below the point on the J-Curve, were net cash positions trend positively. By applying our strategies, re-capitalizing the company and making other appropriate modifications, the Fund can leverage that stranded capital and optimize returns in shorter holding periods, effectively allowing our LPs to make risk-adjusted private equity style investments.
