The Carlyle Group just announced a buyout of XCMC, China's largest manufacturer of construction equipment. Arguably this is the first real LBO ever undertaken in China, and it's expected to trigger a new wave of private investment in state-owned assets.
These Carlyle guys must have balls of steel, because in China they pave the streets with the bones of investment pioneers. During my two years as a director of a Beijing-based start-up I witnessed just about every possible way an investor can be cheated, deceived, kept in the dark and just outright robbed. Like many before me I learned the hard way that China's tantalizing potential tends to remain just out of reach.
This painful reality is brilliantly captured in Tim Clissold's cautionary tale Mr China. Ah, the nostalgia when Tim describes officials from the anti-corruption taskforce who insist on a bribe before beginning an investigation.
Good luck Carlyle. You're going to need it.
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