Foreign financial institutions and sovereign investment funds including Goldman Sachs (GS.NYSE) and Warburg Pincus are lining up a deal to buy a 20% stake in China Huarong Asset Management for about US$2 billion, Reuters reported, citing unnamed sources. Other investors preparing to buy into China’s biggest manager of non-performing loans include Malaysian state investor Khazanah Nasional Bhd, China state-backed CITIC Group and China International Capital Corp. The investors are seeking a share in the profitable business of bad loan management in China. State-owned bad debt managers like Huarong are benefiting from a rise in non-performing loans in China as the economy slows.
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