Digital China recently announced that two private equity groups have agreed to invest in a subsidiary unit.  I wasn’t able to verify this story on the company’s press release page, as it is apparently not currently available ( “Website Updateing [sic], Please visit again later.” )

“Digital China (00861) announces that the two private-equity investors, China Singapore Suzhou Industrial Park Ventures Co. Ltd. (CSVC) and Infinity I-China Investments (Israel), L.P. (Infinity Investments), have agreed to make a total capital investment of up to RMB500 million into Digital China Information Technology Service Co. Ltd. (DCITS), a company currently wholly owned by Digital China, assuming a subscription option (an option to make further capital investment in an aggregate amount of RMB100 million in DCITS granted to the two investors) is exercised, for investment in Digital China’s ITS (information technology services) business.”

The new entity will focus on the IT Services industry for clients in government, telecom and finance.

We have encountered Digital China as a competitor several times for domestic engagements within China.  We’ve yet to run into them in the U.S., but I’ve heard rumors that Microsoft is a client within China.  I wonder if they’ll follow the lead of several of their competitors and use some the new funds to develop western business.

Technorati Tags:  China, China Outsourcing