The Ireland Strategic Investment Fund, a €8.0 billion sovereign development fund managed and controlled by Ireland National Treasury Management Agency, has teamed up with China’s CIC Capital Corporation to establish a €150 million fund to invest in high-growth Irish technology firms with an ambition to access the Chinese market, and Chinese firms seeking to use Ireland as a base for European operations.
The fund, China-Ireland Technology Growth Fund II, is a successor to the now fully-invested China Ireland Technology Growth Fund. The first fund was announced in 2014 by ISIF’s predecessor, the National Pensions Reserve Fund (NPRF) and China Investment Corporation (CIC).
The fund was announced by An Tánaiste and Minister for Foreign Affairs & Trade, Simon Coveney T.D. and Vice Chairman and President of CIC, Tu Guangshao, at an event in Beijing this morning as part of An Tanaiste’s visit to China and Hong Kong.
The second fund, which will again be co-managed by Dublin-based Atlantic Bridge and Beijing-based WestSummit Capital, will place a stronger focus on targeting Chinese companies who wish to use Ireland as a base to access the European market, as well as continuing to invest in Irish companies with a strategic interest in accessing China.
Atlantic Bridge and WestSummit Capital offer cross-border expertise and local networks in China and Ireland to support investee’s international expansions.
"China has emerged as a leader in many areas of technology over the last four years. We look forward to working with CIC Capital again on this new fund, which will offer a strong economic return to Ireland, as Chinese companies looking to gain access to Europe use Ireland as a base for their operations. The Irish companies that will benefit from the Fund will gain from the opportunities to grow their business and product potential in the Chinese market," said Eugene O’Callaghan, director of Ireland Strategic Investment Fund.
The target sectors of the fund will include hardware opportunities underpinning next generation products, such as Internet-of-Things (IoT) and mobile devices, and software applications such as big data, robotics and artificial intelligence (AI), all areas of strength for both Ireland and China.
That earlier €$100 million fund supported six Irish technology firms with expansion into China and helped the firms develop relationships with Chinese customers. Today these firms collectively employ around 350 people in Ireland.
Irish-founded Movidius, a company focused on machine vision technology, with the help of the first fund, was able to build relationships with new Chinese customers, which proved instrumental in gaining commercial traction. Movidius was subsequently acquired by Intel in 2016.
"Ireland’s competitiveness in the technology sector has been growing notably over the years," said vice chairman and president of CIC, Tu Guangshao, during the launch event today. "Irish companies supported by the fund could bring cutting-edge technologies and innovations to China, meanwhile Chinese companies could explore the access to the European market through the fund."
Headquartered in Beijing, China Investment Corporation (CIC) was founded in 2007 as a wholly state-owned company with registered capital of US$200 billion to diversify China’s foreign exchange holdings. It has US$813.8 billion under management.
CIC Capital was incorporated in 2015 with a mandate to specialize in making direct investments to refine CIC’s overall portfolio management and enhance investment on long-term assets.