Chinese State-Owned Firms Establish $1.4 Billion Fund
By P.R. Venkat
Two Chinese state-owned companies will establish a 10 billion yuan ($1.41 billion) fund to invest in companies with real estate project assets.
Under the agreement, New China Life Insurance will be the limited partner providing CNY9.9 billion in capital and China International Capital Corp. will act as general partner that will manage the fund, New China Life said late Monday.
CICC will contribute the remainder of the amount.
The fund is being established at a time when China's property sector is weak due slowing home sales, leaving many companies with significant inventories.
Despite a slew of stimulus measures from Beijing targeting the real-estate sector, severe debt issues and lackluster property sales have continued to plague developers.
New China Life said establishing the fund wouldn't affect its normal operations but would help diversify the company's assets under management.
The fund's term is for eight years, which can be extended.
Write to P.R. Venkat at venkat.pr@wsj.com
(END) Dow Jones Newswires
January 01, 2024 19:55 ET (00:55 GMT)
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