GF Xinde Investment Management Co Ltd, the private equity arm of China's leading securities firm GF Securities Co, plans to expand into foreign markets by setting up a PE fund in the United States that will focus on investment in life science.

GF Xinde signed a strategic cooperation agreement in New York last Friday with Bay City Capital LLC, a US life sciences investment institution, to jointly manage the fund that will invest in innovative life science companies with high growth potential in the United States, Europe and China, according to an official press release.

The fund will facilitate the cross-border mergers and acquisitions in the life science industry and will serve to introduce the world's leading technology to Chinese enterprises. It will also allow Chinese companies to gain access to competitive global products and technology, the statement said.

The official announcement did not reveal the initial value of the fund. But it said the fund has attracted major listed Chinese pharmaceutical companies, including health supplement maker By-Health Co Ltd, State-owned pharmaceutical company Jinling Aodong Medicine Group Co Ltd, Nanjing Pharma Co Ltd, and Nanjing New Industry Investment Group, the major shareholder of Jinling Pharma Co Ltd as initial investors.

Sun Shuming, chairman of GF Securities, said that the fund is the first investment fund that combines "international technology and Chinese backing".

Fred Craves, founder and managing partner of Bay City, said the US fund has been closely following the initiatives put forth by the Chinese government for improving the quality and accessibility of universal health care.

"The current speed of development in China's pharmaceutical industry is much higher than that of Europe and America, thus the country is expected to become the world's largest pharmaceutical market soon. This will provide many opportunities for international medical investment institutions to enter China," Craves said.