Cleantech Finland event presentation June 4th 2015.

1. Beijing Capital Cleantech Fund
- Beautiful Beijing Event -
Cleantech Investments and Financing in China
HU JUNMING,INVESTMENT DIRECTOR, Beijing Capital
Investment
首创创投

2. BCG (Beijing Capital Group) is the investment conglomerate of the Beijing Municipal
Government.
• Founded in 1995 to manage the Beijing government’s assets
• Diversified conglomerate with operations in Financial Services (includes Private
Equity group), Infrastructure, Technology and Real Estate
• Over USD$30 billion in assets under management
• BCG is a trusted and influential brand
• 32 offices throughout China
• 6 publicly-listed subsidiaries
Beijing Capital Investment (Beijing Capital)BCG
BCI (Beijing Capital Investment) is a subsidiary of BCG for PE
and VC investment management.
• Manages BCG’s private equity investment activities
• Pioneer in RMB private equity in China
• Investors in the five prior funds
• Successful track record focusing on high growth, pre-IPO companies

3. • Three PE funds and one VC fund :
• Gross IRR on exited funds from 20%-50%
• Over 30 investments across 5 funds
• 22 exits, 12 through public market exits
• 2 of current portfolio companies in listing queue
A successful track record in managing investments
and generating high returns
Beijing
Capital

4. Funds managed by Beijing Capital
Beijing
Capital
Name Founded in
Investment scale
(RMB)
Beijing Capital Investment (Direct Invest) 1998 300 million
Shenzhen Capital Growth (PE ) 2007 100 million
Xinrong Hengji Investment (PE) 2008 100 million
Ningbo Capital Growth (VC) 2010 100 million
Beijing Fuying Tiancheng (PE) 2012 300 million

5. Name Deals IPO M&A IRR
Beijing Capital Investment (Direct) 10 8 2 53.65%
Shenzhen Capital Growth (PE )
7 2 3 22.93%
Xinrong Hengji Investment (PE) 2 2 32.39%
Ningbo Capital Growth (VC) 4 4
Beijing Fuying Tiancheng (PE) 5 1
Funds managed by Beijing Capital
Beijing
Capital

6. Investment and Market Opportunities
China’s environmental industry
is booming
China is fast becoming a major market for global environmental technology
• More than 8 000 billion RMB flowed into cleantech sector during 2011-2015
• At least 300 million people have migrated and is migrating into urban areas in
the process of urbanization
• As the environmental pressure increasing dramatically, the government and
civil society have achieved a high degree of consensus on the implementation
of stricter environmental policies
• It is expected that the environment/cleantech industry in China grows at an
average annual rate of 15-20%
• 7 “strategic emerging industries” including 3 key industries related to
cleantech, e.g., environmental protection, new energy, energy conservation
and clean energy vehicles

7. Investment and Market Opportunities
S&T VC will be the biggest winners in the
industrial upgrading and the capital
market transformation
Transformation of Chinese capital market
NEEQ is a huge opportunity for science and technology venture capital in China.
NEEQ has gradually formed innovative institutional arrangements and operational
mechanisms for SMEs, and is becoming a good choice for small and medium technology
enterprises to operate their capital. Currently, NEEQ provide listed companies with a
variety of financial instruments, including equity financing, private placement and
preferred equity.
Opportunities for S&T VC
The gene of venture capital perfectly matches NEEQ, and the development of science
and technology venture capital is inseparable from the support of efficient capital
markets. NEEQ, as the best development as well as an exit, provides an excellent
opportunity for the development of S&T VC.

8. The boom in M&A transactions in China happens in the past three years. For example,
the number and value of announced deals in 2014 both increased, by 14.1% and 1.5%
respectively over 2013, reaching 6 967 and 372 billion USD.
In 2015, M&A market is expected to expand and upgrade, moving from traditional
industries to emerging industries. As a sample, Beijing Xiangeqing Co., Ltd., a chain
restaurants operator, changed its name to “Cloud Live Technology Group Co., Ltd.”,
planning to explore the M&A integration in emerging industries based on big data.
As a result of the financial crisis and Euro-zone quantitative easing etc., Chinese
enterprises’ acquisition in overseas markets is growing even faster than in Chinese
market. The number of mainland enterprises overseas M&A transactions hit an all-time
high of 272 in 2014, a 36% increase over 2013.
Investment and Market Opportunities
M&A, especially overseas M&A
brisk up unprecedentedly

9. Investment and Market Opportunities
M&A, especially overseas M&A
brisk up unprecedentedly
Number of M&A transactions
Value of M&A transactions (100 million USD)
Overseas M&A by Chinese companies

10. • In March 2014, BCG acquired Transpacific New Zealand (TPI
NZ) 100% shares through its Hong Kong Listed subsidiary. The
case volume was around 5 billion RMB. The acquiring was
approved by OIO (New Zealand) and completed in June 2014.
• In May 2015, Beijing Capital Water Co, one of Listed company
of BCG, acquired 65% shares of BCG NZ Investment Holding
Limited, which is the biggest waste management operator in
New Zealand. The case volume is around 1.8 billion RMB.
Investment and Market Opportunities
Latest case study by Beijing
Capital

11. Added-value to European technologies
Beijing Capital
Cleantech fund
China is becoming the world’s largest environmental market. The fund aims at:
• to explore the most potential segments of Chinese environmental market
• to develop the complementarity of the expertise (high-tech companies) and Chinese
financing (high growth and pre-IPO companies)
• to invest in and facilitate the JVs with leading technologies and market shares in
Chinese market
• to create a high return (IRR) by the domestic IPO process

12. Invest
ChinaEurope
JV fundLPs
GP
Fund management
company
BCI
Clean Tech
companies
Leading companies
LPs
(BCG ,BCI,BANK,
Chinese investors)
Structure
Beijing Capital
Cleantech fund

13. Industry focus
• Smart Cleantech: technology and service
• Clean energy related operating assets
Forms of investment
• Equity investment
• Joint investment/co-investment through joint venture in the Chinese market
Geographic focus
• The European countries with the strength to match with the top demands of Chinese
cleantech market
Investment stage
• Nordic companies which has locally completed commercialization, with a net
turnover of 1 million to 10 million EUR
Value Realization Strategy
Beijing Capital
Cleantech fund

14. Investment scale
5-50 million EUR, depending on the
specific project
Investment objective
Environmental enterprises with local
market resources + overseas
environmental technology companies
with core technology
Shareholding structure
Aiming at obtaining the right to use
the technology from the source
company, and becoming the
controlling or influential shareholder
of the Chinese company
Criteria
Companies with promising target market and high
growth potential
Time horizon
Investment will be completed in 1-2 years, and
the entire investment cycle is less than 3 years
Exit strategy
Merger integration, independent IPO or
acquisition by listed companies
Governance structure
Clear property structure, identifiable benefits
Target IRR
> 25%
Value Realization Strategy
Beijing Capital
Cleantech fund

15. Key Focus Areas of Cleantech Investment
Smart cleantech areas
Significant technology focuses
Technology focuses
Entry points for subsequent technology
Environmental
services
Water
Energy
Material cycles
Monitoring
services
Governance
services
Water-saving
equipment
Energy Efficiency
Services
New materials
Sludge disposal
Waste-to-energy
Sorting
System
integration
Equipment
Control system
Business model
Miniaturization of
biogas equipment,
refining equipment
Key equipment to
manage energy
consumption
Key equipment to utilize
sludge
Real-time measurement
and big data analytics
Operating facilities and
services in Europe
Assets
Clean energy