By Henny Sender in Hong Kong

Shan Weijian, one of private equity?s most successful dealmakers in Asia, has raised more than $1.7bn for a new fund focused on China at a time of increased scepticism about such investments in the country.

The announcement of the first close of PAG Asia I, expected on Tuesday, is a huge personal endorsement for Mr Shan, formerly of TPG and associated with some of the most lucrative deals completed in Asia by the US private equity group.

PAG Asia I, raised for Pacific Alliance, the Hong Kong-based investment firm of which Mr Shan is chairman and chief executive, may also have benefited from tightening credit conditions and a loss of investor appetite for new China-related listings.

?Every week, people pitch pre-IPO [initial public offering] deals to us,? says Mr Shan. ?But those are more interesting for the local renminbi funds that can?t invest for the long term like we can. To do restructuring or buy-outs, you need to have a track record.?

Many of Mr Shan?s signature deals follow the template of his mentor, TPG co-founder David Bonderman, who bought into distressed US financial institutions and companies during the credit crisis in 1990 and made huge profits.

Many of Mr Shan?s current investors are some of TPG?s large institutional investors, though some are usually barred by their charters from investing in first-time funds.

Mr Shan has a strong record on deals in China, structured to give Pacific Alliance control in many cases, one of his trademarks at TPG.

He has already signed agreements to buy stakes in a retailer in Beijing, an insurer – also in the capital – and in entertainment and hotel groups.

The environment in China for deals has recently become more complicated, due to the presence of hundreds of renminbi funds raised both by local firms and the big international groups.

In many cases, these funds have received backing from the Chinese National Social Security Fund, as well as a network of wealthy individuals who have been put off keeping their money in the bank when the rate of interest on deposits remains in negative territory.

Mr Shan arrived in Hong Kong in the mid-1990s, initially as an economist for JPMorgan and then as a banker, before joining TPG.

He has at times spoken out against both Chinese policy and the profitless growth of many Chinese companies.

Pacific Alliance hopes to raise a total of $2.5bn in coming months for the fund.

? The Financial Times Limited 2011