Foreign Buyout Firms in China Lag in Yuan-Raising Race

Chinese private-equity firms are raising money for funds denominated in the country's currency far more quickly than foreign rivals, putting a cloud over a new strategy that international firms have adopted to overcome investment hurdles in the world's No. 2 economy.

Over the last year, global investment powerhouses including Blackstone Group LP, Carlyle Group LP and TPG have started funds denominated in yuan, or renminbi, that aim to tap China's growing ranks of cash-rich institutions and wealthy individuals. The yuan funds, which are required to be joint ventures with Chinese partners, are designed in part to help the international firms get past sensitivities over foreign ownership that have often complicated investments from their dollar funds into China.

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