Former Goldman executive Fang Fenglei's firm is targeting natural resources as it invests with two others for a minority stake in Chinese coal transporter Winsway.
A trio of Chinese investors led by private equity firm Hopu Investment Management has reportedly agreed to a US$110 million investment in Chinese company Winsway Coking Coal Holdings Limited in return for a 20 percent stake in the company's equity.
The firm inked the deal alongside Hong Kong-listed industrial investment company Silver Grant International Limited, and Chinese state-owned metals trading company, China Minmetals Corporation, according to an article in the Wall Street Journal. Of the US$110 million, Hopu itself invested US$60 million, while Silver Grant and Minmetals collectively invested US$50 million, said a report from news agency Reuters.
Winsway was set up in 1989 and, according to its website, specialises in the trading, distribution, processing, storage and transportation of petroleum, chemicals and coal. According to several media reports, the firm focuses on the transportation of natural resources from Mongolia to China, and counts Canadian mining giant SouthGobi amongst its customers.
For Hopu, the investment is yet another natural resources-linked play. The firm made its first foray into the Mongolian resource sector in 2008 when it and the US$120 billion strong Temasek injected US$300 million in three-year convertible bonds into iron ore miner Lung Ming (now Iron Mining International).
Although not a private equity investment, the firm further strengthened its hand in natural resources earlier this year when it was reportedly hired by Argentinian energy company Bridas Energy Holdings to advise on the setting up of a US$3.1 billion oil and gas production joint venture with CNOOC, China's largest producer of offshore crude oil and natural gas.
Beijing-based Hopu was founded by former Goldman Sachs China mainland securities head, Fang Fenglei, in 2007. It quickly raised a US$2.5 billion fund from investors including Singaporean sovereign wealth fund, Temasek, and Fang's former employer, Goldman Sachs.
