Today, Mitsubishi Corporation (“MC”) announced its decision to launch a joint venture fund with Creat Group Company Limited (“Creat”), a Chinese private investment company, in order to support Japanese companies in the expansion of their business in the China market.
MC and Creat will establish MC Creat Fund Management Limited, a joint venture company based in Hong Kong (Mitsubishi Corporation (Hong Kong) Limited: 50%, Creat Fund Management: 50%). The first funding of JPY 10 billion is due to be launched this August. This Sino-Japan joint venture fund will be the first of its kind to actively support Japanese companies in the expansion of their businesses in the China market. Whilst maximizing the value of the portfolio companies through the fund, MC and Creat aim to increase Japanese companies’ global competitiveness, as well as revitalize the Japanese industry as a whole.
Background of the Fund’s Launch
Today, China is Japan’s largest trading partner, and the business relationship between the two countries is based on a mutual interdependence. For Japanese companies China is not only a vital manufacturing base; it is also becoming an increasingly important consumer market. Large numbers of small and mid-size Japanese companies with excellent technologies and management know-how hold huge growth potential in the global market including China. However, many of these companies are unable to capitalize on the opportunities due to a lack of funds, networks and resources.
Purpose of the Fund
In order to support those Japanese companies which have excellent technologies, strong brand value, services, and management know-how in expanding their business into China, the fund is designed to provide funding to the following companies:
①Small and mid-size Japanese companies with further growth potential in expanding their business in the Chinese market,
②Japanese joint venture companies established in China, or
③Chinese companies which have the potential to be strategic partners for Japanese companies.
The joint venture aims to maximize the value of portfolio companies through management and business development support; both of which can be provided through MC’s global expertise in various industries as a Sogo Shosha, and Creat‘s excellent investment track record and network with first-class private Chinese companies. Moreover, the fund plans to help support the funding needs of the portfolio companies through the IPOs in Hong Kong and other stock markets in China.
Identifying potential investment opportunities and providing investment advice will be primarily carried out by Kizuna Capital Partners (provisional name), a wholly owned subsidiary of MC.
Overview of Creat Group
Company Name: Creat Group Company Limited
Location: Beijing, People’s Republic of China
Established Year: 1992
Chairman: Zheng Yuewen
Creat Group is a growing Chinese private investment company with an excellent investment track record across a range of sectors including manufacturing, mineral resources, financial services and real estate, spanning over 18 years. It has enhanced the enterprise value of its portfolio companies through the active provision of support to management teams. Mr. Zheng Yuewen, founder and chairman of Creat Group, was former vice chairman of ** “All-China Federation of Industry and Commerce” (“ACFIC”), as well as a national committee member of “The Chinese People’s Political Consultative Conference”. He also established the “China International Chamber of Commerce for the Private Sector” (“CICCPS”) as an internal organization of ACFIC, and is also a key player in driving the globalization of Chinese private companies through his role as CICCPS chairman.
** ACFIC is the largest non-governmental chamber of commerce composed of China’s industrialists and businessmen established in 1953. ACFIC has more than 3,000 local chapters at the provincial, municipal and county levels and 2.2 million registered members in China.
Overview of Joint Venture
Company Name: MC Creat Fund Management Limited
Location: Hong Kong Special Administrative Region, People’s Republic of China
Shareholders: Mitsubishi Corporation (Hong Kong) Limited 50%
Creat Fund Management 50%
Contact Person: Xu Enyu (Managing Director)
Overview of Kizuna Capital Partners
Company Name: Kizuna Capital Partners (provisional name)
Location: Marunouchi, Chiyoda-ku, Tokyo JAPAN
Shareholders: Mitsubishi Corporation 100%
Contact Person: Tanaka Kenji (Chief Investment Officer-to-be)