China Life sets up semiconductor fund amid Beijing’s call for ‘patient’ capital
The US$737 million yuan fund for semiconductor investment to support chip firms with ‘substantial technical know-how and resources’
Companies backed by the state and provincial governments in China have announced new funds to focus on the semiconductor industry, which requires a large amount of time and resources to grow, at a time when the country is in need of more “patient capital”.
China Life Insurance, the country’s largest life insurer, backed by the State Council, said it would establish a partnership with total capital of 5 billion yuan (US$737 million) that “principally invests in companies operating in the semiconductor industry”, according to Friday filings to both main bourses in Hong Kong and Shanghai.
The fund, jointly formed with a China Life sister company, would finance chip design firms and others that have “accumulated substantial technical know-how and resources in the semiconductor industry, with distinctive core technological advantages and a well-established research and development system”, according to the filings.
The insurer said that “as a significant force of state-owned capital”, its involvement in “strategic emerging industries such as semiconductors” not only fulfilled its responsibility to support national strategies, but also served as a “concrete manifestation of its role as a provider of long-term and patient capital”.