| |  | | | | | The HKVCA held its annual Golf Day on March 2, 2018 at the Hong Kong Golf Club in Fanling. The event was a tremendous success with perfect weather bringing blue skies and a brilliant sunny day.
Close to 90 people attended, including a number of non-golfing participants. There were a total of 19 teams competing in the tournament, with each team comprised of various GPs, LPs, and professional services providers serving the private equity and venture capital industry. More than 70 golfers teed off and all seemed to enjoy the challenging 40-year-old course and the wonderful weather on the day. The tournament was followed by a buffet lunch.
In addition to the golf tournament, the HKVCA also held two special events: a hole-in-one challenge and a lucky draw. The lucky draw top prize was a Tudor Heritage watch, which was won by Andrew Koo from EY. A total of HK$33,800 was raised through raffle ticket sales and was donated to the Hong Kong Society for the Protection of Children and the Hong Kong Golf Association's junior development program.
We would like to thank our generous sponsors, specifically our Platinum Sponsors Citigroup, Morgan Stanley and White & Case; our Gold Sponsors Ernst & Young, Lexington Partners and Vistra; our Breakfast Sponsor, AON; our Watch Sponsor, Oriental Watch Holdings Limited; our Hole-In-One Prize Sponsor, Mercedes-Benz; our Wine Sponsor, AOC Would Wine; and Lucky Draw Prize Contributors, the Hong Kong Golf Association, Paul Andersson of the Golden Bay Distillery and The Boars Club. We would also like to thank the HKVCA’s Golf Committee - Varun Bery, Chin Chou, Bob Partridge, Sunil Chandiramani and Adam Goern - for their support and leadership.
| Course Competitions | Winner | | Champions | Simon Martyn
Varun Bery
Martin Angus
Roger Wu | | 1st Runners-Up | David Kim
Jeff Bi
Sung-Jin Hwang
Sally Kim | | 2nd Runners-Up | Anurag Mathur
Sunil Chandiramani
Xavier Le Sourne
Mike Imam | | Straightest Drive – Hole #4 | Lorenz Zimmermann | | Closest to the Pin – Hole #2 | Henry Zhang | | Closest to the Pin – Hole #8 | Varun Bery | | Closest to the Pin – Hole #17 | Anurag Mathur |
Photo Album: https://www.hkvca.com.hk/en/Golf2018PA.aspx | | | HKVCA Research Journal 5th Issue | | 
| | A Growing Appetite for Asia | |  | Rebecca Xu is bullish on the region as private equity companies raise record amounts of funds for investment
Rebecca Xu, a Co-Founder and Managing Director of Asia Alternatives Advisor Hong Kong Ltd, is bullish about Asia’s strong fundamentals and structural reforms, which she says will continue to drive healthy economic growth and investment opportunities in the region. | “Each of our core target markets, Greater China, Japan, Korea, India, southeast Asia and Australia, presents different risk/return dynamics. But across these markets, we continue to see attractive buyout, growth and venture opportunities,” she said.
Founded in 2006, Asia Alternatives is a solution platform dedicated to helping institutional investors make investments in private equity across Asia. Based in Hong Kong and with offices in California, Shanghai and Beijing, it specializes in buyouts, mid-market, growth and expansion, venture capital, and special situation strategies. The firm primarily invests in Asia Pacific with a spotlight on Greater China, focusing on delivering superior risk-adjusted returns through a portfolio of value-added strategies to investors.
The bullishness about Asia perhaps highlights the growing appetite from global institutional investors for private equity products that are focused on the region. This was borne out by Asia Alternatives’ recently announced final closing in September 2017 of its fifth fund (Asia Alternatives Capital Partners V, LP), at record speed. The fund attracted commitments from public and corporate pension funds, endowment funds, foundations and family offices such as the Florida State Board of Administration, Boeing Co’s and Massachusetts Mutual Life Insurance Company. It currently has total assets under management (AUM) of over US$11 billion.
Private equity managers are raising record amounts of funds for investments in Asia, where deals are getting larger in size as buyers increasingly aim to gain control of companies. Indeed, as a co-founder of one of the first Asia-dedicated fund-of-funds, Xu has a unique perspective on the region’s alternative investment market trends. Among several recent developments she noted is the above-mentioned increase in control-oriented buyout deals in China and India, particularly at the larger end of the deal range but also happening in mid-market companies, a trend she thinks is here to stay.
“Buyout historically has been found mostly in more mature economies such as Japan, Korea and Australia. Lately, however, more business founders and owners in China and India have been willing to give up control in order to engage investors who bring not only capital but also capacity and expertise to provide value add services. This is driven by the need to implement operational change or address succession issues,” she said.
Another rising phenomenon is technology disruption, resulting in a greater number of active venture capital investments in technology companies across Asian markets. Even mature businesses in traditional sectors, such as retail and consumer services, are having to go through significant operational upgrades or business model innovation by integrating technologies, Xu said. These are done to defend their market positions, expand customer reach and improve operating margins, and deals in this category require managers to have the capacity and expertise to help companies implement such transformations.
These market developments contributes to increasing investment appetite in markets across the region, Xu noted. “Over the past year, we’ve seen a resurgence of interest in Asian private equity among limited partners. An increasing number of investors are convinced that Asia private equity offers attractive risk-adjusted return. They are attracted to long tenured, established and proven managers who have produced top quartile returns on a consistent basis,” she said.
This is having an impact on exit opportunities and investment return with investors focused solidly on both. “Improving public market sentiment since last year certainly has been good news to managers who have companies in their portfolios aiming for an IPO in the next 12-24 months. We have also seen a broader set of exit venues, including secondary deals, sales to strategic or financial buyers,” Xu said.
This sentiment could bode well for Hong Kong in the wake of the Hong Kong Stock Exchange’s recently announced plans to change certain listing rules so as to attract a number of significant IPOs from new economy and technology companies. | | | | | Members Only Event |  | | Tax Update: Hong Kong's New Transfer Pricing Regulations and US Tax Reform | | Sponsored by |  | | | Speakers: | Adam Williams, Partner, Greater China Private Equity Tax Leader, Ernst & Young Tax Services Limited, Hong Kong | | Justin Kyte, Partner, Financial Services Transfer Pricing, Ernst & Young Tax Services Limited, Hong Kong | | Aaron Topol, Partner, US Tax Desk Leader – APAC, International Tax Services, Ernst & Young Tax Services Limited, Hong Kong | |  | | Date: | 23 March, 2018 (Fri) | | Time: | 12:30 - 14:00 | | Venue: | 22/F, EY Office, CITIC Tower, 1 Tim Mei Avenue, Admiralty, Hong Kong | | CPT: | 1.5 points | | RSVP: | Alfred Lam (alam@hkvca.com.hk) | |
| | Limited seats available |  | | Identifying Off-balance Sheet Red Flags: Pre-Transaction and Post-investment | | Sponsored by |  | | | Speakers: | Stuart Witchell, Managing Director, Berkeley Research Group
Ben Yeung, Director, Berkeley Research Group | | | | Date: | 19 April, 2018 (Thur) | | Time: | 12:30 - 14:00 | | Venue: | The China Club, 14/F, The Old Bank of China Building, 1 Bank Street, Central, Hong Kong | | Fee*: | Full Member (Corporate): one free pass per company | | Associate Member/ Full Member (additional pass): HK$450 per person | | Non-Member: HK$800 per person | | CPT: | 1 point |  
| | Members Only Event |  | | Sponsored by |  | | | Date: | 11 May, 2018 (Fri) | | Time: | 8:00 - 9:00 | | Venue: | Victoria Suite, Hong Kong Club, 1 Jackson Road, Central, Hong Kong
(Room reserved under the name of Johnny Chan) | | Fee*: | Full Member (Corporate): one free pass per company | | Associate Member/ Full Member (additional pass): HK$300 | | *Note, free pass no shows will be charged full price | | *An additional charge may apply to accommodate special dietary requests. | | | |
| 
| | | Gender Equality in PE: Has There Been Progress? | | Sponsored by |  | | | Speakers: | Judith Li, Partner, Lilly Asia Ventures (Moderator)
Bonnie Lo, Partner & COO, NewQuest Capital Partners
Denise Mak, Managing Director, CVC Capital Partners
Jie Gong, Partner, Pantheon Ventures
Melissa Guzy, Managing Partner, Arbor Ventures
Wendy Zhu, Managing Director, AlpInvest Partners | | | | Date: | 17 May, 2018 (Thur) | | Time: | 12:00 - 14:00 | | Venue: | KPMG Office, 8/F Prince's Building, 10 Chater Road, Central, Hong Kong | | Fee*: | Full Member (Corporate): one free pass per company | | Associate Member/ Full Member (additional pass): HK$200 per person | | Non-Member: HK$400 per person | | *Fee inclusive of a light lunch | | CPT: | 1.5 points |
|  |  | | The 17th HKVCA China Private Equity Summit | | Date: | 5 June, 2018 (Tue) | | Time: | 9:00 - 17:15 (followed by cocktail reception) | | Venue: | Forum – N101, Hong Kong Convention and Exhibition Centre (New Wing),
1 Expo Drive, Wan Chai, HK | | Lunch – Bauhinia Room, Hong Kong Convention and Exhibition Centre | | CPT: | 6.5 points | | | | | | Confirmed Speakers: | (alphabetically by Last Name) | Keynotes:
James Lau, Secretary for Financial Services and the Treasury, HKSAR Government
Roger Luo, President, DJI
Chris Ip, Senior Partner, McKinsey & Company
Ivo Naumann, Partner, McKinsey & Company |
Kent Chen, Managing Director, Neuberger Berman Asia
Peter Chen, Managing Partner & CFO, ZZ Capital
Lorna Chen, Head of Greater China, Shearman & Sterling
Brian Chi, Managing Director, The Blackstone Group
Jacob Chiu, Managing Director, Asian Private Equity, HQ Capital
James Donnan, Managing Director, Intertrust Hong Kong
Wei Fu, CEO, C-Bridge Capital
Jie Gong, Partner, Pantheon Ventures (HK)
Herry Han, Partner, Lightspeed China Partners
Wei Hopeman, Co-Founder & Managing Partner, Arbor Ventures
Priscilla Huang, Partner, KPMG
Ryan Law, Managing Director, Morgan Stanley Asia
Nisa Leung, Managing Partner, Qiming Venture Partners
Alvin Li, Senior Managing Director & Head of Direct Investments, CCB International Asset Management
Jireh Li, Chief Representative & Director, Commonfund Capital
Judith Li, Partner, Lilly Asia Ventures
Ting Li, CEO, Yunfeng Financial Group
Paul Liu, Founder & Managing Partner, Huisheng Consulting
Eric Mason, Managing Director, The Church Pension Fund
Jason Nelms, Partner, Morrison & Foerster
James O'Callaghan, Partner, Advisory, KPMG China
Olivia Ouyang, Director, Funds (Hong Kong), Ontario Teachers’ Pension Plan
Stone Shi, Partner, Ascendent Capital Partners
Ming Shu, Partner, Lingfeng Capital Management
Michael Susanto, Managing Director, PAG
James Tam, Head of M&A Asia-Pacific, Morgan Stanley
Conrad Tsang, Founder & Chairman, Strategic Year Holdings
Alan Tso, Founder & CEO, China Mini Storage
Daizong Wang, Partner, NewQuest Capital Partners
Steve Wang, Managing Director & Co-Founder, Pine Field Capital
William Wang, Partner, Primavera Capital Group
Rebecca Xu, Co-Founder & Managing Director, Asia Alternatives Advisor Hong Kong
Frank Yang, Founding Partner & CEO, Blue Ocean Capital Advisors
Paul Yip, Executive Director, PAG
Joseph Zeng, Partner, Greenwoods Asset Management
Jianyi Zhu, Partner, ADV Partners
| | | EARLY-BIRD RATE (Payment deadline: 30 April, 2018) | | HKVCA Members | Corporate Full Members | One free pass per company | HK$3,200 HK$4,300 per person | HKVCA Corporate Associate /
Overseas Members | HK$3,200 HK$4,300 per person | | Non-Members | Non-Members | HK$5,200 HK$6,300 per person | Members of supporting organisations
(20% off) | HK$4,160 HK$5,040 per person | LP firms (sovereign wealth funds,
pension funds, endowments, foundations,
family offices, DFIS and fund of funds) | One free pass per company
HK$5,200 HK$6,300 per person | | | | | Simultaneous interpretation will be provided in English and Mandarin in the main conference room. | |
| | Supporting Events:
| | | New Members | | Corporate Full Members | | | CITIC Capital Holdings Limited
Founded in 2002, CITIC Capital Holdings Limited is an alternative investment management and advisory company. The firm manages over US$22 billion of capital across 100 funds and investment products through its multiple asset class platform covering private equity, real estate, structured investment and finance, and asset management. CITIC Capital has over 130 portfolio companies that span 11 sectors and employ over 820,000 people around the world. | | | Serendipity Capital (International) Company Limited
Serendipity Capital is a wholly-owned private equity fund established by Modern Land (China) Co. Limited (Hong Kong Stock Code: 1107) in 2016, which focuses on investment in senior and health care real estate. Since its establishment, the fund has managed US$350,000,000 in total assets, providing Modern Land (China) Co. and other investors with solutions for global asset allocation, value appreciation, profit creation and risk mitigation. Leveraged on the professional capabilities of Modern Land (China) Co. Limited in primary land preparation and secondary land development, the fund has been able to achieve an optimal allocation of resources and build a brand name in asset management. | | | | | | Overseas Full Members | | | | Diana Capital UK Ltd | | | Entrepreneur Metropolitan Kuala Lumpur Cooperative
Our founding mission is to address the lack of capital for entrepreneur business expansion. We assist by pooling, organizing and managing the capital from our members, investing in projects that will directly benefit them through high returns and growing entrepreneurship. CoMetroKL invests in local private equity businesses, purchasing, selling and managing property, and financing and improving human capital. Koperasi Usahawan Metropolitan Kuala Lumpur Berhad, known as the Entrepreneur Metropolitan Kuala Lumpur Limited Cooperative, is a cooperative registered and incorporated under the Malaysian government’s Akta Koperasi 1993. | | | | | | Corporate Associate Members | | | Cordium Asia Limited
Cordium helps financial services firms around the world transform governance, risk and compliance (GRC) challenges into opportunities – to enhance regulatory relationships, improve processes, manage risk and grow the business. The deep expertise of our teams enables Cordium to support clients across the entire GRC lifecycle – from start-up through maturity – with a wide range of consulting services and technology solutions. Our specialists understand the challenges financial services firms face because they have served as compliance officers, lawyers, regulators, and in other roles. This means Cordium’s specialists are able to truly partner with firms, bringing in the right expertise – from regulatory change management to tax services, regulatory hosting to employee filing software support. | | | Jefferies Hong Kong Ltd
Jefferies offers deep sector expertise across a full range of products and services in investment banking, equities, fixed income and wealth management in the Americas, Europe and the Middle East and Asia. | | | Thomson Reuters
Thomson Reuters is the world’s leading source of news and information for professional markets. Our customers rely on us to deliver the intelligence, technology and expertise they need to find trusted answers. The business has operated in more than 100 countries for more than 100 years. Thomson Reuters shares are listed on the Toronto and New York Stock Exchanges. | | | Vivien Teu & Co LLP
Vivien Teu & Co LLP is dedicated to providing legal services for clients at the highest standards to meet their needs in today’s complex and dynamic business and regulatory environment. Established with the philosophy of a boutique law firm focusing on the areas of corporate, securities, asset management and financial services, its lawyers are experienced in advising international and local corporates, including large global institutions, listed entities and industry conglomerates, and international, Hong Kong and China banks, securities, asset management and private equity firms. | | | | |
| | Recent Events Report | | | HKVCA Members Breakfast Meeting
9 March 2018 |  | | The HKVCA's monthly breakfast meeting was held at the Hong Kong Club on March 9, 2018. The event was oversubscribed, with over 80 members taking full advantage of the opportunity to network and reconnect with their fellow industry practitioners. This month's breakfast would not have been possible without the sponsorship of KPMG to whom we would like to extend our sincere thanks for their continued support and help in making this terrific networking event possible for our members. | | | HKVCA Seminar: The Case for Listed Private Equity in Hong Kong
7 February, 2018 |  | | The HKVCA hosted a seminar on February 7, 2018 on the subject of listing private equity funds on the Stock Exchange of Hong Kong Exchange (HKEx). Held at the offices of Neuberger Berman, the seminar attracted more than 25 members of the Association.
The speakers at the seminar were John Buser, Executive Vice Chairman at NB Alternatives; Gordon Crosbie-Walsh, Joint Head of China Investment Banking and Asia Head of Equity Capital Markets at Jefferies; and Stephen Peepels, Head of U.S. Securities, Asia Pacific at Hogan Lovell. Among the issues discussed were the advantages of listed private equity and the regulatory framework of listing rules in Hong Kong and the UK. The speakers also shared a number of relevant case studies and the latest industry statistics. | | | HKVCA Members Breakfast Meeting
2 February 2018 |  | | The HKVCA's monthly breakfast meeting was held at the Hong Kong Club on Friday, February 2, 2018 and attracted over 80 members. This breakfast would not have been possible without the support of Berkeley Research Group to whom we would like to extend our sincere thanks for their sponsorship and help in making this terrific networking event possible. | | | |
| | | Industry News | | Oxford Vacmedix moves cancer vaccines forward with $12.5M from South Korea, China | | —March 06, 2018 | | (Endpoints News by Amber Tong) - South Korea and Chinese investors have sunk a collective $12.5 million into an Oxford University spinout that promises a more efficient and cheaper way to make cancer vaccines. | | (link to the full article) | | | | China pledges to attract global talent and venture capital in bid to accelerate technology push | | —March 05, 2018 | | (SCMP by Meng Jing/Zen Soo) - China has pledged to accelerate its efforts to surpass the US in advanced technologies from artificial intelligence (AI) to robotics by wooing overseas talent and venture capital investment. | | (link to the full article) | | | | HNA Pledges HK$3B Stake in Kai Tak Developer to PAG in Return for Loan | | —February 21, 2018 | | (Mingtandi by Shawna Kwan) - What was once the site of one of Asia’s most challenging airports is rapidly turning into a lifesaver for China’s debt-addled HNA Group after the mainland conglomerate announced a deal yesterday that could provide it with a loan of as much as HK$3 billion ($383 million) from private equity firm PAG. | | (link to the full article) | | | | Hong Kong: Aviva and Tencent form online life insurer | | —February 19, 2018 | | (Asia Insurance Review by AIR team) - Major UK insurer Aviva and its partners, Chinese Internet giant Tencent Holdings and private equity fund Hillhouse Capital, have agreed to develop an insurance company in Hong Kong, which will focus on digital insurance. | | (link to the full article) | | | | | |
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