The FINANCIAL — Warburg Pincus and Societe Generale, one of the largest European financial services groups with presence in 66 countries, jointly announced today that Warburg Pincus has completed the transaction to acquire 49% stake in Fortune SG (“Fortune”), a leading asset management company in China.
As one of China’s first Sino-foreign joint venture fund management companies, Fortune was established in 2003 by Huabao Trust, a subsidiary of Baosteel Group, and Societe Generale. The company offers a wide range of products and services, including domestic public equity fund products, overseas investment fund products and wealth management under separately managed accounts (SMAs). Recognized for its prudent operating style and forward-looking product and service coverage arrangement, Fortune holds a market-leading position in the common fund industry in overall competitiveness and performance. As of June 30, 2017, Fortune SG’s managed public equity assets totaled RMB 122.5 billion, according to Societe Generale.
Ben Zhou, Managing Director of Warburg Pincus, commented, “We believe in the long-term growth opportunities of China’s asset management industry and mutual fund industry, and we are optimistic on the outlook of economic transformation and financial reform in China. We are excited to partner with Baowu Group and Fortune, and look forward to supporting Fortune’s growth with our global resources and network in the asset management industry.”
Helen Xiaoyi Huang, Chief Executive Officer of Fortune, commented, “All business lines continue to deliver stellar performance, and it remains the company’s top priority to maximize the unitholders’ interests. With our new shareholder Warburg Pincus on board, we shall continue to honor our commitments to provide outstanding asset management service with unparalleled supports from both its Chinese and US shareholders.”
Warburg Pincus is one of the earliest and largest global private equity firms to invest in China. Since 1994, the firm has invested over US$ 8 billion in over 100 companies in China, including China Huarong, Car Inc., Baosteel Gases, ZTO Express, ESR, Mobike and Red Star Macalline. Warburg Pincus is also a leading investor in the financial services and fintech sectors, with over USD 10 billion invested in over 90 companies in these sectors.
This transaction will have a limited positive impact on Societe Generale’s financial ratios.
Hikaru Ogata, Head of Societe Generale in Asia Pacific, commented, “Societe Generale’s decision to sell its stake in Fortune is consistent with the Group’s active management of its business portfolio, which aims to concentrate on activities and markets where it can reach a critical size. We are confident that Warburg Pincus, with its strong track record of investing in financial services and a growing focus on Asia, is well-placed to fuel Fortune’s future development. Societe Generale remains committed to China and the Asia Pacific region with offices in 12 locations, with 8,000 employees and an extensive range of expertise from corporate and investment banking to asset management, securities services, global transaction banking and specialized financial services”.