HONG KONG (Reuters) - The venture capital arm of China’s largest insurer, Ping An (601318.SS), is targeting raising up to $1.3 billion in two healthcare-focused funds that will seek growth-stage and pre-IPO investments, said a person with direct knowledge of the matter.
Ping An Ventures, set up in 2012, focused on early-stage investments in its first few years. The new funds will deepen the group’s push into the healthcare sector and build up its firepower for later-stage investments, at a time when valuations in the fast-growing tech and healthcare industries have spiked.
The venture capital firm aims to raise $300 million to $500 million in a dollar-denominated fund and 4 billion yuan to 5 billion yuan ($640 million-$800 million) in a yuan fund, the person said. They would be Ping An Ventures’ biggest dollar and yuan funds so far and would primarily invest in healthcare start-ups at home and overseas, the person added.
Ping An Ventures, whose investments include ride-hailing firm Didi Chuxing, has tapped prospective investors, including wealth management firms and institutional investors, for the new funds, the person said. The fundraising is expected to be completed within this year, the source added.
Ping An Ventures declined to comment on the fundraising. The person declined to be named as the information was confidential.
The fundraising plans come as the average value of late-stage investments globally surged 40 percent last year, according to data provider Preqin. Investments of $100 million-plus made up more than half of all global VC fundraising by value in 2017, versus barely 8 percent in 2007, Preqin data showed.
The plans also come as Ping An Insurance Group Co of China (2318.HK), China’s largest insurer by market value, is looking to boost its direct investments and expertise in the healthcare industry.
Two Ping An healthcare-related units plan to go public in Hong Kong this year - Ping An Good Doctor, an online medical platform which allows users to consult doctors for diagnosis, and Ping An Healthcare Technology, a medical data collection and analysis business.
The latter last week completed a $1.15 billion pre-IPO fundraising round, Ping An said. That valued it at about $8.8 billion, according to sources.
Last year Shenzhen-based Ping An launched a Hong Kong-based $1 billion fund, called Global Voyager, to scout for healthcare and fintech assets in the United States, Israel and Singapore.
Ping An Ventures operates separately from Global Voyager, and apart from generating returns, seeks to use the acquired technology and know-how to help its parent develop its business in China.
It has more than 100 portfolio investments including domestic on-demand services provider Meituan-Dianping, New York-based Oscar Health Insurance and online payment platform Payoneer and Philadelphia-headquartered biotherapeutics firm Tmunity Therapeutics.
($1 = 6.2829 Chinese yuan renminbi)
Reporting by Julie Zhu; Editing by Muralikumar Anantharaman and Christian Schmollinger