Finally� Someone With Some Foresight

For much of the last 2 years, I have been working to convince people that the opportunities in China go far beyound the city limits of Shanghai, Beijing, and Guangzhou.� that if a firm looks at the cities of Wuhan, Chengdu, Xi’an, and Xiamen, they will uncover that there are some very interesting opportunities there, some strong talent, and financial rewards.

So when I read Chilton Investment sets sights on western China in the China Daily, I immediately saw this as a post.� According to Richard Chilton Jnr, the company’s chairman and chief executive

Chilton Investment had visited Chengdu and Chongqing this year and found many high-quality companies with limited access to capital.

“For most of them, we were the first western investors to visit,” he said.

and al I can say is that it is about time.� while I know there are firms (more manufacturing and real estate) focused showing interest (my second tier reports are one of All Roads most heavily trafficed posts), the fact is that many PE/ VC� funds have shied away believing that the best deals are here.

The problem is that for firms in Shanghai, there is a tour that everyone makes and with so much attention, so much “love”, the expected valuations are off the chart… but it is easy right?� the executives speak English (pay premium for that), they are McKinsey trained (pay premium for that), and their PPTs have embedded flash (pay premium for that).

Case in point, 2 years ago I was working with a portfolio of assets in Nanjing that offered a 90% chance of a 200% gain in 12-18 month time frame.� the company holding the assets was going through bankruptcy court and was looking to roll out from their debt.� The assets were clean, we had support from the court.. yet no one would bite.

why?

(more…)

Read Original Post Here

Rate this company: