The Carlyle Group, world's biggest private equity investor, will open its first representative office on the Chinese mainland this year to help the firm invest in the world's most vibrant economy.

"Carlyle is going to open an office in Shanghai sometime this year," said Christopher Ullman, Carlyle's vice president of corporate communication, in an e-mail reply to Shanghai Daily, without specifying the timing. "That will better enable us to conduct investment activities on the mainland."

China's economy, which expanded by a higher-than-expected 9.1 percent last year, is projected to grow 9.5 percent this year, according to consensus forecast by investment banks Goldman Sachs and UBS AG.

The fast-growing economy will create more consolidation among industries, which in turn will open up business opportunities for foreign investors seeking global investments.

"We continue to be very impressed with the opportunities in China and are quite optimistic that they will continue to increase as the economy grows and modernizes," said Ullman.

Unlike mutual funds which invest in securities products, private equity investors go for companies, whether start-ups or established ones, to help them grow and expand their business until they qualify for public listing.

Then private equity investors cash out the investments by selling their stakes in companies on the stock market.

At present, Carlyle has investments in China's mainland and Hong Kong through a US$750 million Asia buyout fund and two venture funds.

It has invested in China Pacific Holdings, which operates a chain of nine department stores on the mainland.

The firm's investments in Hong Kong include Amperex Technology Ltd, a manufacturer of batteries used for mobile electronic devices, and Boto International, the world's largest supplier of Christmas tree.

(Eastday.com March 31, 2004)