China Huarong to Set Up M&A Investment Fund
Xu Wei
DATE:  Apr 17 2020
/ SOURCE:  Yicai
China Huarong to Set Up M&A Investment Fund China Huarong to Set Up M&A Investment Fund

(Yicai Global) April 17 -- China Huarong Asset Management, one of China’s biggest asset managers, plans to set up an investment fund focusing on mergers and acquisitions made via debt-for-equity swaps.

The Beijing-based firm has already registered the fund with the Asset Management Association of China, it said in a statement yesterday. It will leverage its advantages in social capital to make equity investments that will help it become more influential, the company added.

Huarong’s profit slid 9.6 percent last year to CNY1.4 billion (USD198 million) last year despite revenue rising 5 percent to CNY113 billion (USD16 billion), according to its financial report for 2019. The decline was a large improvement on 2018, when profit almost halved to CNY1.6 billion following a radical expansion plan.

Revenue from its primary business rose 7.8 percent to CNY69.8 billion in 2019 and the proportion of the total it made up rose 1.6 percentage points to 62 percent, prompting Chairman Wang Zhanfeng to say a return to its main business was paying off.

Huarong was incorporated in 1999 as one of just four such companies with approval from China’s cabinet. It became a limited company in 2012, amid a nine-year period ending 2017 when its assets soared from CNY15.6 billion to CNY182.6 billion. It had 31 branches at the end of 2017 and a plethora of subsidies involved in securities, financial leasing, banking, trusts and futures.

Editor: James Boynton


 

Follow Yicai Global on
Keywords:   China Huarong Asset Management