Templewater, an alternate funding agency co-founded by a former Deutsche Financial institution AG banker, is looking for as a lot as $800 million for 2 funds in Asia, in what it calls a “difficult” market with fundraising near a decade low.
Article content material
(Bloomberg) — Templewater, an alternate funding agency co-founded by a former Deutsche Financial institution AG banker, is looking for as a lot as $800 million for 2 funds in Asia, in what it calls a “difficult” market with fundraising near a decade low.
The brand new funds will goal mid-sized companies in Asia and clear vitality know-how corporations, stated Cliff Zhang, who began the corporate in 2018 with Investec Group, an Anglo-South African banking and wealth administration group. The $1.7 billion asset supervisor has began elevating $400 million to $500 million for its second non-public fairness fund, doubling its earlier pool, and is looking for $300 million for a decarbonization fund, Zhang stated in an interview.
Commercial 2
Article content material
Article content material
Templewater is bracing for probably the most troublesome fundraising atmosphere for Asia in no less than a decade. Pension funds and key backers are maxed out on the quantity they’re keen to allocate to non-public fairness companies, notably in Asia, as a result of the funds have been sluggish to return cash to traders. The agency is betting that an anticipated 65% capital distribution from its first fund by the tip of this 12 months will persuade current backers and new traders to take part within the second fund, Zhang stated.
“We imagine that true alternative typically presents itself within the midst of adversity,” stated Zhang. “We’re elevating capital now to grab the second to put money into transformative companies which are poised for progress because the world emerges from latest upheavals.”
The Hong Kong-based fund has up to now returned 14% of its capital to traders, he stated. Following his exit at Deutsche Financial institution’s company finance division in 2013, Zhang was named senior vp at Chow Tai Fook Enterprises Ltd. a privately owned conglomerate managed by billionaire Henry Cheng. The Harvard College grad additionally labored at HSBC Holdings Plc.
High Tales
Article content material
Commercial 3
Article content material
The agency is looking for to faucet funds from institutional traders and rich people in Asia and the Center East, Zhang stated. Fundraising for Templewater’s first $200 million fund in 2019 dragged on till December 2021 because of protests in Hong Kong and the pandemic. The fund didn’t make any investments in 2022 as rising rates of interest and shaky markets put the brakes on funding exercise.
In line with Preqin Ltd., within the first six months of 2023 companies within the area had raised simply 22% of the earlier 12 months’s complete, after non-public fairness fundraising in China dropped considerably. As of August, there had been simply 9 funds closed within the area, elevating a mixed $2.7 billion, with the variety of fund closures on monitor for a decade low, based on PitchBook knowledge.
Templewater’s decarbonization fund has already secured commitments from Hong Kong-listed CIMC Enric Holdings Ltd., a fuel gear maker, together with Canadian fuel-cell maker Ballard Energy Methods Inc. The fund invests in international know-how corporations within the hydrogen worth chain, vitality storage and carbon seize. The brand new non-public fairness pool will give attention to healthcare, mobility, important providers and precision manufacturing in Asia. Final 12 months, the agency purchased 51% of Luye Medicals Group Pte’s oncology and cardiology companies in Singapore.
Commercial 4
Article content material
The decarbonization fund targets traders looking for to adjust to sustainable finance laws imposed by the European Union, requiring disclosure on how companies promote environmental and social goals by way of investments moderately than simply contemplating sustainability dangers.
Templewater developed Hong Kong’s first hydrogen refueling station and its first hydrogen double-decker bus. It signed an settlement final week with Abu Dhabi to develop a sequence of inexperienced options together with a photo voltaic plant, growing hydrogen refueling stations and managing battery and gas cell electrical bus fleets. Its portfolio firm, Knowledge Motor, delivered the United Arab Emirates’ first hydrogen bus on the COP28 local weather summit final 12 months.
Investec spun off its Asia principal funding division in 2021. Templewater is Investec’s unique non-public fairness funding arm in Asia excluding India.
Article content material
