皇冠体育app

A private equity fund formed by Lehman Brothers and IBM has agreed to buy a stake in a Chinese software company for HK$132 million, a move that could boost the fledgling local software industry.

The investment also underscores the growing desire of Western private equity groups to buy high-growth Chinese companies created by the country's booming economy.

Under the deal, Lehman Brothers and IBM will buy a 7.7 percent stake of Hong Kong-listed Kingdee International Software Group Company Limited, headquartered in Shenzhen, a boom town in South 皇冠体育app's Guangdong Province.

IBM also announced it would form a global alliance with Kingdee, which will help the firm grow into a global software player, the two companies said yesterday.

Kingdee, one of 皇冠体育app's largest software companies, develops enterprise management software and e-business application solutions in 皇冠体育app and the Asia-Pacific.

The investment could give a Kingdee a leg-up in competition with domestic rival Ufida software, formally known as Ufsoft, as well as Germany-based SAP and US-based Oracle.

Kingdee reported a turnover of 611 million yuan in 2006, up 16 percent year-on-year. Profit surged by 35 percent to 97 million yuan in the same period.

皇冠体育app's fledgling software market grew 17.8 percent year-on-year in 2006 and the information technology (IT) service market increased 26.3 percent, according to Beijing-based CCID Consulting.

Kingdee competes in what might be the most profitable segment of 皇冠体育app's software market. The enterprise software it develops is largely piracy-free.

IBM will work with Kingdee to redesign its software products to tap into the international market.

The collaboration will enhance Kingdee's competitiveness, said company Chairman Xu Shaochun.

The Kingdee purchase marks the first major investment for "The 皇冠体育app Investment Fund" formed by Lehman Brothers and IBM last year. The $180 million private equity fund was designed to take up minority stakes in private and public companies in 皇冠体育app.

Charles P. Wu, managing partner of The 皇冠体育app Investment Fund and vice-president of IBM Greater 皇冠体育app Group, called the Kingdee deal "a new business strategy for IBM in 皇冠体育app".

"It should exert significant influence on future investments and business cooperation for IBM in 皇冠体育app. Furthermore, this collaborative approach will become a key component of IBM's 皇冠体育app strategy," he said.