China Minsheng seeks new foreign partner

China Minsheng Bank, the country’s first private sector lender, is in discussions with European financial firms over the sale of a minority stake, Reuters reported. Minsheng is effectively looking for a replacement for Temasek, the Singaporean sovereign wealth fund, which sold off the remainder of its holding in the second quarter of 2008. Apparently Temasek, which already has stakes in China Construction Bank and Bank of China, was told it couldn’t invest in more than two Chinese lenders. Minsheng also plans to raise about US$1.46 billion by issuing up to 1.5 billion new shares in a private placement to existing large domestic shareholders, the bank’s Chairman Dong Wenbiao said. Furthermore, Minsheng intends to nearly double its stake in California’s UCBH Holdings, the parent company of United Commercial Bank, to 19%. In December, Minsheng was allowed to increase its stake to 9.9% from 4.9%.