China Life to Invest in CITIC PE Fund

(Beijing)–China Life Insurance has committed to investing 2 billion yuan in CITIC Private Equity Funds, the latest step taken by the insurer to tap the PE sector.
 
A source closed to the situation said China Life, the country's biggest insurer by market value, agreed to take 20 percent of CITIC's third private equity fund, which is set to raise 10 billion yuan. Chinese insurance companies can invest in up to 20 percent of the total fundraising in a PE fund.
 
The investment has won approval from China Insurance Regulatory Commission, the source said. Last year, China Life Insurance received a license for PE investment and made its first deal in January, a 1.6 billion yuan investment in Hony Capital.
 
CITIC Private Equity Funds announced fundraising plans for its Private Equity Fund III in September 2011. The fund will focus on areas including finance, consumer goods and healthcare. The fund has received 5 billion yuan from investors.
 
Chinese insurance companies, including Taikang Life Insurance Co. and Pingan Insurance, have sought investment opportunities in the private equity sector. PE funds have welcomed large institutional investors, such as pension fund and insurance companies.
 
However, due to time-consuming approval procedures, China Life is the only insurer to make a successful investment in PE funds so far.