An investment fund of up to 2 billion yuan (US$293 million) will be launched in Pudong New Area at the end of the year to finance projects in high-growth sectors including information technology, modernized manufacturing and new energy, a source in Pudong said yesterday.
The government-backed Shanghai Pudong Science and Technology Investment Co, which has already poured 500 million yuan into the fund, aims to raise another 1.5 to 2 billion yuan, said the source, who declined to be identified.
Softbank China Venture Capital, backed by Japan's Softbank Corp, has been appointed manager of the fund and will take a small stake in the fund.
"The fund is being set up by the end of the year although the financial crisis has brought uncertainty," the source said.
In October, US$363 million was poured into the Chinese mainland by venture capitalists, a 16.7 percent drop compared to a year ago, according to ChinaVenture, an investment research firm.
A period of slow economic growth is a good time for venture capitalists to invest, because of low valuations and more choice in the market, industry insiders said.
The fund will focus on the fast-growing hi-tech sectors in China, especially in Pudong.
Many promising firms are located in Pudong's Zhang°?jiang High-Tech Industry Zone, regarded as the city's silicon valley. High-growth firms such as Shanda Entertainment, an online games company, and The9, another games firm with the license to distribute World of Warcraft in China's mainland, have set up headquarters in the zone.
(Shanghai Daily November 11, 2008)
