(Yicai Global) March 17 -- China’s largest state-owned chip fund will get back to recouping its investments in the country’s chipmakers as the end of its payback period approaches and after a difficult period last year when a number of investigations into a series of executives connected to the fund were launched.
The China Integrated Circuit Industry Investment Fund Phase One, which acts as a seed investor in the semiconductor sector getting startups on their feet before withdrawing, will start paring its investments more quickly now, market insiders said.
The investment fund, which was set up in 2014, has a planned payback period from 2019 to 2024. Last year’s probes blocked the retrieval of funds and so the fund will speed up its shareholding cuts this and next year, an analyst told Yicai Global.
CICIIF intends to reduce its equity in Changchuan Technology by at most 2 percent over the next six months, the Hangzhou-based semiconductor test equipment maker said yesterday. At present, CICIIF holds a 6.7 percent stake.
The Big Fund will pare its stake in Wanye Enterprises by up to 1 percent over the next three months, the Shanghai-based real estate developer said the same day. CICIIF is the third-biggest shareholder at present with a 5.2 percent stake.
The fund first said it planned to reduced its shareholdings in these two firms in April last year, but its efforts to do so were hampered by a crackdown on corruption in the chip sector which kicked off last July.
That month Lu Jun, the ex-president of Huaxin Investment Management, who was also involved in the management of CICIIF, was placed under investigation for graft. This was followed by several other executives connected to the fund, including its own general manager Ding Wenwu.
Phase Two of the Big Fund, with a pot of over CNY200 billion (USD29 billion), was set up in 2019 and is now in the phase of large-scale investment. The fund has invested tens of billions of Chinese yuan in more than 20 projects to date.
Editors: Dou Shicong, Kim Taylor