CGNU Forms Investment Partnership With Government For China

June 19, 2000

CGNU and the U.K. government’s CDC Capital Partners, its emerging market investment agency (formerly the Commonwealth Development Corporation), announced the creation of an investment fund of up to $100 million in the Chinese market.

“The 50-50 joint venture, called CGU-CDC China Partners, would take private equity stakes in about ten projects in different sectors over the next three to four years, CDC chief executive Alan Gillespie told a news conference,” Reuters news Agency reported.

In addition to supplying half the capital, the presence of CDC brings valuable expertise in investments in emerging markets, which will hopefully help the new venture to avoid the troubles many other investment funds have run into in China, CGNU Chief Executive Bob Scott, was reported to have stated.

CGNU has applied for one of the 7 new licenses, which China has agreed to issue following the successful completion of discussions with the European Community, which could lead to China’s joining the WTO, but the investment was not seen as being connected.

Following a meeting with Chinese Premier Zhu Rongj, Scott expressed optimism about CGNU’s chances, but could give no estimate of when the license might be issued.

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