An international investment fund managed by Tsinghua Incubation and Investment Management Co. has been recently set up in Beijing. The China Environmental Protection Fund 2002, registered in British Cayman Islands is the first of the international venture capital in China's environmental protection industry.
The management company and the international investors conducted a one-year-long investigation of the domestic market and, based on analysis of the experiences in developed countries, came to the consensus that China's environmental protection industry market has great potentials.
The fund will invest in firms, either in their embryonic or mature stages of development, in environmental protection, clean production service, energy saving and comprehensive resource utilization.
The management company will adopt international norms in venture capital investment and select firms with great potentials, based on studies of their growth background, market prospects, management and profit-making pattern and business risks.
The company will invest in options and define the operations of the firms it invests in. After several years of growth it will withdraw its capital through IPO and merging and get its investment returns. In the process of investment, it will attach great importance to social responsibility and ask the firms it invests in to operate strictly in accordance with international norms and patterns for coordinated social, environmental and economic effects.
The Chinese environmental protection industry in its initial development stage has broad market prospects. Though numerous, they are small-scaled, faced with shortages of capital and R-and-D capabilities. The fund will provide the capital they need for growth as well as advanced foreign technology. It also expects to incubate a number of major powerful environmental protection companies through merging and consolidation in China.
The fund will avail itself of the R-and-D capabilities of Tsinghua University and of its own international resources, experiences and expertise to expand its investment business in China. The Tsinghua management company, one of China's most active venture investors, has been managing a RMB venture capital fund and invested in 11 projects. Its management is composed of experts who have had experiences in venture capital investment in the silicon valley in California, U.S.A., domestic venture capital investment and capital operations and large enterprise financial management and are well versed with domestic industry.
The managers of the fund which will be 20 million U.S. dollars by the end of the year will try to attract new investors to expand its scale. As the earliest trial, the fund will help expand the Chinese environmental protection market and the integration of foreign advanced technical expertise, management and capital and improve Chinese competitiveness in this field. It will, too, help introduce more international venture capital to enter into China's environmental protection industry and stimulate its development.
(www.cenews.com.cn August 28, 2002)
