Mandarin Capital Partners achieve 3X record exit for a Chinese PE Fund abroad

SHANGHAI, Feb 27 (Reuters) – Mandarin Capital Partners, the largest Sino-European private equity fund said on Monday that it has sold parts of its stake in Italian pharmaceutical firm Euticals to another fund, realizing three times investment returns — a record for a China outbound investment fund.
    Mandarin Capital, whose investors include Chinese policy lender China Development Bank [CHDB.UL], sold the stake in Euticals — which has an estimated enterprise value of over 300 million euros ($403 million) — to Italian private equity fund Clessidra, reducing its ownership in the firm to 24 percent from 54 percent, Mandarin said in a statement, without disclosing the size of the deal.   
    Mandarin said that it would still retain control over the company after the transaction, and would leave great room for future capital gains through business expansion and initial public offerings in China or overseas stock markets.
    Mandarin Capital, whose main investors include CDB, the Export-Import Bank of China and the second largest Italian bank Intesa SanPaolo <ISP.MI>, is one of the funds set up with the mission of facilitating cross-border investment and aiding overseas expansion by Chinese companies.
    In addition to Mandarin Capital, state-backed CDB has also invested in cross-border funds such as Infinity Group and China-Africa Development Fund. Earlier this month, China launched a 50 billion yuan ($7.94 billion) fund in Shanghai to aid overseas acquisitions by Chinese companies.           
   Gao Zhen, Managing Partner of Mandarin Capital said that the Euticals deal exemplifies Mandarin’s investment strategies of helping portfolio companies to expand in Chinese or European markets and fuel growth through merges and acquisitions.
    Mandarin Capital bought a controlling stake in Euticals in December 2008 and has helped the company build partnerships with Chinese and European companies, and completed four acquisitions.
    Mandarin said it would continue to support growth of Euticals, which will seek for presence in Asian markets such as India and China, where the company plans to establish a production base this year.