Companies

TPG invests $45m in China sportswear maker

(Agencies)
Updated: 2010-10-19 16:16

Global private equity giant TPG said on Tuesday that it formed a consortium to invest more than $45 million in Chinese casual sportswear maker China Vogue, betting that the country's rising middle class will boost demand for sports shoes, apparel and accessories, Reuters reported on Tuesday.

The TPG-led consortium, which also includes Swiss investor Partners Group and an existing shareholder ARC China Holdings Ltd, expects the new funding to help China Vogue Casualwear Ltd capture a bigger share of the country's nascent, but fast-growing casual sportswear market.

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"They are a fast growing business with a strong brand and are well positioned to lead the domestic casual sportswear market in China," Sing Wang, co-chairman of TPG Greater China, said in a statement.

TPG and rivals such as the Carlyle Group and the Blackstone Group are stepping up investment in China to take advantage of the country's rapid growth and Beijing's support for the domestic private equity industry.

TPG, which had invested in Chinese firms including PC-maker Lenovo, shoe-seller Daphne and supermarket chain WuMart, announced plans in August to set up two yuan-denominated funds in China, aiming to raise a combined 10 billion yuan ($1.5 billion).

China's sports apparel market grew 34 percent annually between 2005 and 2009, driven by rising wealth and sports events such as the 2008 Olympic Games, but expenditure per capita is still low compared with that of Japan and South Korea, according to consultancy Frost & Sullivan.

China Vogue, based in the southeastern province of Fujian, sells sportswear under the Sisulan brand through a network of more than 1,000 self-owned and third-party-owned retail outlets, which are mainly located in China's less affluent second- and third-tier cities.