HONG KONG: China Investment Corp (CIC), the country’s sovereign wealth fund, is divesting approximately US$1 billion worth of US private equity (PE) assets in the secondary market, as part of a broader portfolio optimisation strategy.
The assets are spread across funds managed by eight US-based PE firms, including Blackstone Inc and Carlyle Group. US investment bank Evercore is advising on the sale, which CIC aims to complete by the end of June, sources told Reuters.
Originally invested between 2016 and 2017, the portfolio is nearing the end of its investment cycle. The potential asset sale comes amid rising US-China geopolitical tensions, which have led Chinese state-backed funds to scale back new investments in American PE firms.
CIC’s PE investments represent a significant portion of its nearly US$1.33 trillion in assets under management, with close to 64% of assets managed externally. Possible buyers include other sovereign wealth funds, secondary market specialists, and private investors such as family offices. Singapore’s GIC is reportedly among the interested parties.
This strategic exit highlights a broader trend among global institutional investors rebalancing private equity exposure due to market volatility and limited exit opportunities.–REUTERS
