China Development Financial Holding Corp (中華開發金控) said yesterday it recently set up a private equity fund that aims to invest in unlisted companies in the local creative industries, in line with a strategy shift to focus on asset management, instead of capital gains, to pursue higher earnings.
The fund has paid-in capital of NT$1.5 billion (US$50.18 million), with the conglomerate’s main subsidiary, China Development Industrial Bank (中華開發工銀), accounting for 40 percent and the government-owned National Development Fund (國發基金) chipping in about 20 percent, China Development Industrial Bank chief investment executive David Chow (周大任) said.
Other investors include firms in the technology, tourism and logistics sectors, which have provided 50 percent of the capital and may supply the other half in the next 12 to 18 months, Chow said.
The fund was set up as China Development Financial is seeking to cut its dependence on investments of its own capital, because the strategy has been blamed for the company’s low returns on equities and a lack of recurrent income, Chow said.
The new fund, which still needs regulatory approval, is part of the company’s plan to change strategy, after rising labor costs in China squeezed the profits of technology firms, while China’s economic reforms suggest huge business opportunities for service providers, Chow said.
The fund is targeting a return of 30 percent and is seeking to create value for Taiwanese vendors in skincare products, travel agencies, restaurants and the entertainment business, among other partners, Chow said.
Ideal targets should have the ability and share the ambition to expand in China because the local market is too small, he said.
Separately, the Financial Supervisory Commission yesterday approved plans by China Construction Bank Corp (中國建設銀行) to upgrade its representative office in Taiwan to a branch.
The Chinese lender set up its representative office in April 2011 and it has qualified for the upgrade after meeting the one-year requirement, the commission said in a statement.
The Chinese bank is the world’s sixth largest in terms of tier-one capital and it occupies 12th place by measure of its assets, the commission said.
The bank’s capital adequacy ratio rose to 14.32 percent last year from 13.68 percent in 2011, helped by a 40 billion yuan (US$6.44 billion) bond issue.
At the weekend, the bank, one of China’s top four lenders, reported that its net profits rose 14.1 percent year-on-year to 193.2 billion yuan last year, up from 169.3 billion yuan in 2011 on growth in net interest income.
In Italy’s storied gold-making hubs, jewelers are reworking their designs to trim gold content as they race to blunt the effect of record prices and appeal to shoppers watching their budgets. Gold prices hit a record high on Thursday, surging near US$5,600 an ounce, more than double a year ago as geopolitical concerns and jitters over trade pushed investors toward the safe-haven asset. The rally is putting undue pressure on small artisans as they face mounting demands from customers, including international brands, to produce cheaper items, from signature pieces to wedding rings, according to interviews with four independent jewelers in Italy’s main
Macronix International Co (旺宏), the world’s biggest NOR flash memory supplier, yesterday said it would spend NT$22 billion (US$699.1 million) on capacity expansion this year to increase its production of mid-to-low-density memory chips as the world’s major memorychip suppliers are phasing out the market. The company said its planned capital expenditures are about 11 times higher than the NT$1.8 billion it spent on new facilities and equipment last year. A majority of this year’s outlay would be allocated to step up capacity of multi-level cell (MLC) NAND flash memory chips, which are used in embedded multimedia cards (eMMC), a managed
Japanese Prime Minister Sanae Takaichi has talked up the benefits of a weaker yen in a campaign speech, adopting a tone at odds with her finance ministry, which has refused to rule out any options to counter excessive foreign exchange volatility. Takaichi later softened her stance, saying she did not have a preference for the yen’s direction. “People say the weak yen is bad right now, but for export industries, it’s a major opportunity,” Takaichi said on Saturday at a rally for Liberal Democratic Party candidate Daishiro Yamagiwa in Kanagawa Prefecture ahead of a snap election on Sunday. “Whether it’s selling food or
In the wake of strong global demand for AI applications, Taiwan’s export-oriented economy accelerated with the composite index of economic indicators flashing the first “red” light in December for one year, indicating the economy is in booming mode, the National Development Council (NDC) said yesterday. Moreover, the index of leading indicators, which gauges the potential state of the economy over the next six months, also moved higher in December amid growing optimism over the outlook, the NDC said. In December, the index of economic indicators rose one point from a month earlier to 38, at the lower end of the “red” light.
RSS