Hony Capital, the private equity firm launched by China-based conglomerate Legend Holdings, has closed a $2.7bn dollar-renminbi denominated fund, Bloomberg reported today, citing people familiar with the matter.
About 70% of the fund is in dollars and the rest in renminbi, a source told Bloomberg. Hony is taking a dual currency approach to avoid conflict between the firm’s dollar and yuan investors, who traditionally would have seen their capital invested separately.
Founded and sponsored by Legend in 2003, Hony focuses on Chinese investments and prior to the latest fund managed five dollar-denominated private equity funds, two renminbi funds and two renminbi mezzanine funds, working out to RMB 48bn ($7.4bn) under management.
The firm’s investments include property as well as buyouts for foreign and domestic businesses, but it has also provided funding to several private venture-backed companies, including workspace provider WeWork and film production studio Linmon Pictures.
The newest fund will back both Chinese and international companies, with target areas set to include consumer businesses, healthcare and pharmaceuticals, and industrial equipment producers.
Although the limited partners for Hony’s latest fund have not been disclosed, the firm has in the past secured backing from insurance firm China Life, Goldman Sachs, Temasek, Canada Pension Plan Investment Board and China’s National Social Security Fund.