DCL Investments, a leading institution in China’s distressed assets investment sector, has successfully closed fundraising for its latest flagship distressed assets fund, securing nearly RMB 4 billion in capital commitments. This represents steady growth compared to predecessor funds. This achievement is particularly noteworthy against the backdrop of accelerated consolidation in the primary market, increasing scarcity of quality assets, and widespread fundraising challenges confronting private capital firms. It underscores how distressed assets investing—a specialized segment characterized by unique attributes and higher barriers to entry—is gaining greater traction among professional institutional investors. As a preeminent player in this space, DCL Investments has established itself as the preferred partner for allocators seeking exposure to this strategy, leveraging its deep domain expertise and brand reputation built through years of dedicated focus.
The investor base for this fund comprises exclusively top-tier domestic institutional investors, including over ten insurance companies, multiple state-owned investment platforms, proprietary capital from select securities firms and trust companies, and university endowments. This achieves near-comprehensive coverage across major categories of institutional Limited Partners (LPs). Consistent with prior funds, this closing maintains a high re-up ratio among existing LPs while also establishing inaugural partnerships with several new institutions, notably including leading domestic insurance capital and large state-owned capital entities.
The fund will leverage DCL’s extensive experience in investing, restructuring, and operating distressed assets to deeply source and capitalize on opportunities to acquire core assets at attractive valuations arising from liquidity crises or operational distress. The fund has substantially completed the formation of its initial portfolio, establishing a diversified investment base across multiple asset categories and geographic regions. Notably, partial exits have already been executed on certain assets, generating favorable interim returns for invested LPs, with DPI contribution velocity significantly exceeding the private equity industry average. Strategically, DCL will maintain its meticulous, disciplined, and prudent approach, concentrating on quality assets in core urban locations and regions. Deployment will focus on the firm’s established strengths in industrial real estate, shipping & logistics, and new energy-related infrastructure, while balancing portfolio liquidity and return objectives.
Ms. Zheng Hualing, Chairwoman of DCL Investments, stated: “We are deeply honored to once again garner support from our institutional LPs. Access to high-quality, long-term capital remains the cornerstone enabling DCL to deepen its specialization and pursue continuous innovation within the industry. As we have consistently emphasized, distressed assets investing in China, having evolved over two decades, has progressed beyond the relatively simplistic 1.0 era. It has now decisively entered a 2.0 phase defined by genuine professional value-add and operational enhancement. Leading institutions’ advantages are poised to become increasingly pronounced, particularly evident in complex transactions involving single-asset deals or bankruptcy reorganizations – areas where DCL is progressively expanding its participation. From our perspective, the distressed assets sector will continue to present compelling investment windows over the coming years. On one hand, the waning impact of the pandemic, the underlying resilience of the economy, and recovering market confidence should provide robust support for core asset valuations. On the other hand, persistent internal and external uncertainties, coupled with the protracted nature of economic transition, will continue to generate a steady flow of distressed opportunities. Well-capitalized leading institutions are positioned to capitalize on this momentum, seizing opportunities to acquire and restructure quality assets.”
Founded in 2015, DCL Investments is a leading asset management platform in China exclusively focused on the investment, restructuring, and operation of distressed assets. The firm has cumulatively managed multiple RMB and USD-denominated funds with aggregate paid-in capital exceeding RMB 10 billion. Through years of execution and refinement, DCL has established a highly efficient, full-cycle asset management platform capable of capturing multi-faceted investment opportunities across the distressed assets spectrum. The firm has developed mature systems encompassing deal sourcing, rapid asset valuation, and post-investment operational management, pioneering a market-oriented, platform-based, and systematized approach to distressed investing in China. Looking ahead, DCL remains committed to deepening its focus on the distressed assets sector, adhering to its core values of “Focus, Professionalism, Symbiosis, and Mutual Success,” and striving to deliver consistently strong, predictable returns for its investors.