撮要

GE Equity Asia was established in the late 1990s as the Asian division of GE Equity, the private equity arm of GE Capital. Shortly after the 2008 financial crisis, GE authorized GE Equity Asia to raise a USD500–750 million Asian private equity fund, which would for the first time bring in third-party investors as limited partners (LPs). GE Capital was planning to commit to investing 10–20% of the fund as an anchor investor. Fundraising was going smoothly until mid-2010, when the Dodd–Frank Wall Street Reform and Consumer Protection Act, a major financial reform law in the United States, was enacted.
In particular, the section (typically called the “Volcker Rule”) prohibited federally insured banks and their affiliates from investing in or sponsoring private equity funds and hedge funds. Although not a bank, GE Capital was deemed to be captured under the broad definition of “affiliate” adopted by the Volcker Rule. Consequently, the plan for a GE Capital-sponsored Asian private equity fund was dropped, as the sponsorship appeared to be prohibited by the new law. At this critical juncture, the team had to evaluate their options and formulate a new strategy for GE Equity Asia.

學習目標

1. To assess GE Equity Asia’s competitive position in the PE industry;
2. To analyze the investment strategy of GE Equity Asia from 2000 onward;
3. To explore the rationale behind GE Equity Asia’s investment strategy;
4. To identify the problems and challenges faced by GE Equity Asia; and
5. To explore the options GE Equity Asia has to face its challenges.