ABN Amro Asset Management has agreed to buy a 33 per cent stake in Xiangcai Hefeng Fund Management, the asset management arm of Xiangcai Securities, China's seventh-largest brokerage, the Financial Times said. The price paid was not disclosed, but to secure the deal the Dutch group had to buy out four existing shareholders of the Shanghai-based firm, which has a registered capital of Yn100m.
This move puts the ABN on course to become the first foreign fund management company to conduct business in China's US$500bn A-share market, currently off-limits to foreign investors except through a recently announced and restrictive Qualified Foreign Investors scheme.
ABN said that Xiangcai Hefeng had agreed to sell ABN Amro further shares to take the Dutch group's stake up to 49 per cent when regulations permitted. Under the terms of China's accession to the World Trade Organisation in 2001, foreign fund managers are limited to a 33 per cent stake until three years after accession, when they can take 49 per cent.
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