Hina Capital Partners ("HCP"), the private equity unit of Hina, focuses on investing in China oriented Technology, Media and Telecommunications (“TMT”) related opportunities in China and the United States.

China’s TMT sector is projected to grow at 13% per annum (roughly 3 times the expected growth rate in the United States) to reach over $300 billion by 2007. China already attracts more foreign direct investment than any other country except the United States. In addition, significant macro level changes are creating a unique opportunity for private equity investments.

WTO Entry and Economic Reform. With China’s entry into the WTO, there is significant demand for new capital to drive the country’s continued development and to enhance domestic company competitiveness. IT spending is expected to increase across all sectors as Chinese companies brace for greater opportunities and impending competition.

Regulatory Changes. Recent liberalization of foreign ownership restrictions, M&A and capital markets regulations has made it easier to invest into China and realize exit opportunities.

Westernization. Many overseas Chinese entrepreneurs are returning to China to establish very successful businesses. They are providing positive examples on access to capital and access to liquidity. At the same time, domestic companies are looking to the West to seek best practices in operations, financial management and strategic development.

Private Sector Growth. China has been one of the fastest growing economies in the world over the last twenty years. China’s private sector continues to lead this growth and already accounts for the majority of China’s industrial output. This market opportunity is creating very profitable domestically oriented investment opportunities that are still below the “radar screen” of many institutional investors.

Real Privatizations. Recent changes in government policies have created the world’s largest privatization opportunity, enabling foreign investors to invest and buy state owned assets in the TMT sector. Today, there are more than 150,000 SOEs worth over US$1 Trillion in China, creating a significant opportunity to participate in selective opportunities.

Our Investment Advantage

China’s private equity investor landscape is broadly segmented into 2 groups - foreign and local investors. While foreign investors possess deeper international investment experience and broader overseas business networks, local investors have better access to deals and are better equipped to due diligence transactions. HCP possesses both local deal sourcing and execution capabilities, as well as international business experience and networks. Furthermore, because HCP is fully integrated with Hina’s Investment Banking group, we are better equipped to source deals and help our portfolio companies in their corporate finance initiatives which include finding exit opportunities for our investments.

HCP has assembled one of the most experienced teams to lead investments in the Greater China region. The partners of HCP consist of top investment professionals and operating executives in China and the United States, who have extensive local Chinese investment knowledge, relationships, and experience, aswell as successful track records of operations, management execution, and technology development in the US. We are uniquely positioned to capitalize on investment opportunities due to the following reasons:

Investment Focus. HCP is one of the first global private equity funds focused primarily on Greater China. We have an experienced team of mainland Chinese investment professionals who have a successful track record of investing and doing business in China.

Access to Deals. Our credibility and extensive government and business relationships enable us to access and participate in the most attractive and proprietary investment opportunities in China. Furthermore, in combination with Hina’s Investment Banking platform, we already have one of the largest local deal sourcing and execution teams in China today. This is especially critical in China since many companies only need to raise one round of financing before achieving a liquidity event, eliminating the opportunity to invest in future rounds.

Understanding Local Business Risks. With deep local insights, we are able to conduct effective due diligence and quickly evaluate local business risks. Hina’s ability to analyze the deeper China-related business, regulatory and financial risks positions us to invest in the more complex, but higher return opportunities.

Managing Regulatory Hurdles. In addition to our strong relationships with regulatory agencies, local and central governments, we understand first hand how to navigate the complex regulatory environment.

International Experience. HCP’s international perspective and experience in both China and US enable us to build value for our portfolio companies. We are also able to leverage our Investment Banking capabilities and business networks to build alliances with global partners and to create international M&A opportunities.

Operating Experience. Investing in China is not simply a financial exercise. It takes a deep understanding of how business is done in China in order to conduct proper due diligence and to add value to our portfolio companies. The HCP team has deep operating experience, with the majority of the partners having past experience as operating CEO or COO’s of both private and public companies, in the US and in China.

Successful Investment Track Record. Members of our team have invested in some of the greatest success stories in China and the United States, including: Sohu, Eachnet, JRJ, Baidu, PRC.edu, GoRemote, 3721, Billpoint, 8848.

Our Investment Focus and Strategy

HCP will focus the majority of its funds on China based companies, and a smaller portion on US based companies with products and services relevant to the China market. In China, HCP will lead invest in profitable companies across all stages. Our investments will possess the following attributes:
• Address a large and growing market opportunity
• Strong management team with track record of success and integrity
• Business with sustainable competitive advantages
• Strong top-line and bottom line growth
• Profitable and capital efficient
• Attractive valuation

In the US, we will invest along-side leading US investors and will leverage our extensive China platform to assist such companies to expand into China. In all cases, HCP will be a proactive investor. We work inpartnership with each of our portfolio companies to add value by: providing strategic insights, bringing in management best practices, assisting with globalization initiatives, and accessing financings and other liquidity channels. HCP will leverage the full resources of the Hina Group to create value, whether it is in “internationalizing” a locally oriented China based company or assisting a US company to grow in China through M&A.

HCP’s conservative investment philosophy and disciplined investment process is based on years of investment, and operating experience by the HCP senior management team in the China region. We believe this approach in combination with our global business relationships and experience and cross-border Investment Banking platform will help generate extraordinary returns for our partners.

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