Weifu Hi-tech disclosed on April 2 that the company will invest RMB90M to establish Wuxi Weixinda Venture Capital Co., Ltd. (Weixinda) together with Wuxi Venture Capital. With the growth enterprise market to be launched, venture capital investment will be another investment hot for listed companies after securities investment and staking in dealers.

The two investors Weifu Hi-tech and Wuxi Venture Capital belong to the same industry group. For Weifu Hi-tech, Weixinda is its second invested VC firm. Previously, it staked in Hejun Venture Capital Co., Ltd. Sources show Weifu Hi-tech will invest RMB90M, for a 90.0% stake while Wuxi Venture Capital invested RMB10M for a 10% stake. The investment deal will be completed via two phases. The first phase is RMB50M from the two investors based on the above proportion.

This deal may encounter risks for it has not been approved by relevant authorities. This deal, as an incubator of new technology and new products of listed company, will not bring investment return for listed companies in a short run.