East Meets Mideast
Robin Goldwyn Blumenthal, BARRON'S, 8 Oct 07
IT'S NO SECRET THAT THE MANAGEMENT-TURNOVER rate in China is among the highest in the world, and that the Chinese have had some problems with quality control (lead paint, anyone?). Now Infinity, a $350 million Israeli venture-capital fund that invests in China, thinks it has an answer: Bring Chinese executives to Israel for Western-style management training and an exchange of ideas.
Next week, 15 Chinese managers culled from more than 1,000 applicants will begin a month-long stay in Tel Aviv. They'll be tutored by professors from the Kellogg School of Management and Tel Aviv University in such areas as corporate governance, Western law and accounting, and best practices. Then they'll return to Chinese companies that are both Infinity partners and potential partners, and put their skills to work on a day-to-day basis.
Since an all-expenses-paid trip to Israel may not be enough to attract the best Chinese talent, Infinity is offering some classic Western-style motivation for managers: options on 15% to 20% of stock in the Infinity company they work for. It plans to take a private-equity fund public in the first quarter of 2008 and, later, to do a U.S. initial public offering of a Chinese partner company.
"Chinese management are extremely excited about the possibility that Chinese companies will be listed in the U.S.," says Infinity managing partner Amir Gal-Or. And the help won't be one-way. China's government has already invested $5 million directly in an Infinity venture, and Gal-Or says it took an $80 million stake in the private-equity venture fund. | 
