China-based fast food chain Zhou Heiya International has formed a RMB3bn ($475m) retail-focused investment fund in partnership with venture capital firm Tiantu Capital.
The fund, tentatively named Shenzhen Tiantu Xingnan Innovative Consumption Industry M&A Investment Partnership, was disclosed through a Hong Kong Stock Exchange filing on Monday and will target investments in the “consumption upgrade” and new retail space.
The filing revealed that the partners have supplied the first RMB1bn for the fund. Chusi Fangda, a limited liability vehicle established by Zhou Heiya, provided half of the capital, which came from its parent’s balance sheet.
Tiantu supplied the remaining RMB500m, with RMB490m coming through a subsidiary called Tiantu Xing’an. It will manage the fund’s investments on a day-to-day basis and will have three its five committee seats, with Chusi Fangda holding the other two.
Tiantu Xingnan will make equity investments in companies but is also open to establishing new entities through partnership deals. Its capital is expected to be committed over a four-year period.
In addition to partnering Zhou Heiya in the fund, Tiantu is also one of its key investors. The food retailer, which was founded in 1997, went public in a $427m initial public offering in Hong Kong in late 2016, after which Tiantu retained a 7.9% stake.