Mixed ownership fund launched in Shanghai

China launched its mixed ownership reform of state-owned enterprises fund in Shanghai on Tuesday, with a total fund size of 200 billion yuan (US$30.62 billion).

The fund will focus on two major aspects of investment directions — core areas and core technologies — to help deepen reform of mixed ownership of SOEs in China.

It is the third national-level fund dominated by the State-owned Assets Supervision and Administration Commission and entrusted to state-owned operating companies to launch, following the state-owned venture capital fund and the state-owned enterprise restructuring fund.

Registered in the Lingang new area of the China (Shanghai) Pilot Free Trade Zone, it has raised 70.7 billion yuan in the first phase.

The investment of the mixed ownership reform funds is mainly carried out through the combination of equity investment and the investment of sub-funds. 

China Chengtong, which contributed 24 billion yuan to hold 33.95 percent of the shares, is the largest shareholder in the fund, and will be responsible for the fund’s day-to-day operations and investment decisions.

China Vanke Co and Shanghai International Port Group also said they would become large shareholders in the fund.

Other shareholders include SOEs such as China Three Gorges Corporation, China National Building Materials Group, China Reform Holdings, China COSCO Shipping Corp, and China Southern Power Grid Co.

Shanghai Mayor Gong Zheng said the establishment of the mixed ownership reform fund in the city was a major move to deepen SOE reform and to strengthen cooperation between the SASAC and the city.

It also marks the efforts made by central enterprises to support Shanghai in implementing the national strategy and speeding up the construction of the Lingang new area, Gong added.

"We will take the opportunity of the fund's establishment to further deepen cooperation with central enterprises to jointly push forward national strategic missions," Shanghai Party Secretary Li Qiang said.