TPG Capital and Hony Capital have entered into an agreement to acquire a 10.95% stake in Chinese supermarket company WuMart Stores for $215 million. Following the deal's completion, TPG will own approximately 6.71% of the company. WuMart also said that it plans to list its shares publicly within the next three years. This is TPG's second investment in China this year, having agreed to buy $81 million of convertible bonds and warrants in footwear maker Daphne International.
Private equity firms have long espoused the opportunities that exist for private equity in China and it appears that they are picking up the pace of investments in the country. A number of the major PE firms, such as The Carlyle Group and Kohlberg Kravis Roberts have made investments in Chinese companies this year. The Blackstone Group just announced a yuan-denominated fund, and in July Carlyle closed an Asian growth fund with over $1 billion to invest in the region and has already used it to back Chinese woman's fashion house Ellassay. Another interesting investment was KKR's $150 million growth investment in Mengniu Modern Dairy.