China is a booming economy, as we know. Investment companies are looking to spread their clients’ wealth abroad in order to minimise any risk should the Chinese economy take a slowdown.
Indeed this is a clear demonstration of China’s wealth and economic strength.
At the same time, the Chinese Government has recently relaxed legislation on individuals investing in overseas markets. Previously this was only possible through investment companies – but as a result of these changes, many new private equity and pension funds are now being invested into foreign markets.
The UK is an attractive market for Chinese investors. The economy is viewed as being the fastest growing and most stable of the entire EU cohort. Investors are looking for projects, chiefly in three bands:
- £1m to £10m – private investors or smaller companies investing pension funds and similar.
- £10m to £40m – larger corporates, often investment companies representing multiple individuals or smaller companies, consortiums of £1-3M each, and smaller banks and corporates looking for a safe and high yield opportunity.
- £40m plus – the larger banks and asset purchasing corporations.
CUK has access to many Chinese investment companies for secure and stable, sensible investment opportunities provided by the UK. Potential clients interested in these opportunities should be aware that Chinese investors generally seek high and quick returns, sometimes requiring ownership of the investment and high equity stakes.
CUK can help to market your investment opportunity to the right level of investor through its network of trusted and proven investor relationships.
Pointers to remember
- Chinese look for security. If you have Government support for your investment, this is helpful.
- Be prepared to negotiate hard for equity and returns.
- There is a very delicate balance of cultural and legal aspects when closing an investment deal with your investor partner. CUK is well placed with the necessary expertise and contacts to help you avoid the pitfalls and drive a successful outcome.