China Doubling Down on US Managed Private Equity with Megafund InvestmentJune 12th, 2008
China’s sovereign wealth fund recently announced the investment of approximately $2.5 billion into mega firm TPG’s latest fund with a target close of $15 to $20 billion. What’s so interesting about this commitment is that it follows China’s well noted direct investment of $3 billion into The Blackstone Group (NYSE: BX) last summer.
China’s Blackstone investment could not have been more poorly timed as BX is off more than 50% since its 2007 IPO. However, despite the Blackstone sting, China is demonstrating the wealth fund is not afraid to re-up in US managed private equity. The larger lesson learned as an outside private equity investor is that the safe way to get your positive returns is to stay the traditional course and be an LP in funds.