The private equity market in China is presenting investors with unprecedented challenges. More money, more funds, and more fund managers have increased the competition for deals. At the same time, many fund managers are under pressure to put money to work.
While we consider China a very attractive private equity destination, we believe the current environment will lead to a weeding out of fund managers who are unable to meet investor expectations.
According to our experience, more China private equity deals fail due to lack of target competitiveness than due to any other factor, including fraud and mismanagement. Fund managers who recognize and address this problem have a lot to win. By conducting strategic due diligence, fund managers can determine a potential investment target’s ability to win with a surprisingly high degree of accuracy.
In the following posts we present our take on how the most effective private equity firms approach due diligence in China. Our objective is to present concrete “how to” on the following topics:
- China PE Due Diligence ‘Best Practice’: The Big Picture
- China PE Due Diligence ‘Best Practice’: Due Diligence Strategy
- China PE Due Diligence ‘Best Practice’: Strategic Due Diligence
- China PE Due Diligence ‘Best Practice’: Strategic Due Diligence Execution
- China PE Due Diligence ‘Best Practice’: The Human Factor
Our ViewOur team-members' views and reflections on China-related mergers and acquisitions (M&A) – including inbound foreign investment and outbound Chinese M&A – and other China-related business issues.