Posted inBusiness moves

HNA looks to buy a stake in Value Partners

Value Partners’ stock price jumped 8.6% before suspension on Monday amid reports that China's HNA Group is looking to buy a stake in the firm.

The Chinese conglomerate is in talks to purchase a stake in the Hong Kong-listed fund house from its chairman Cheah Cheng-hye, according to Bloomberg. Its value was not specified.

Value Partners confirmed that a third party had approached Cheah and Yeh V-Nee, the two co-founders of the firm, for a potential acquisition of a stake, according to a filing to the stock exchange

Cheah, Value Partners’ key figure, is 63 years old and approaching the age of retirement. The two co-founders hold about 41% of outstanding shares.

“The discussion is still on-going and the relevant shareholders have not entered into any definitive agreement with the potential offeror in relation to the possible transaction,” the statement noted. The stock resumed trading today.

If completed, the acquisition would follow HNA’s aggressive expansion globally in various industries, including the asset management business.

Earlier this month, HNA became the top shareholder of Deutsche Bank with a 9.9% stake worth roughly €3.6bn ($4.0bn). It also gained a majority ownership in the Austrian asset manager C-Quadrat Investment AG.

In March, HNA bought a 25% stake in Old Mutual’s US asset management arm for about $446m.

In January, it purchased a controlling stake in SkyBridge Capital, the US investment management firm owned by Anthony Scaramucci, the former campaign fundraiser for Donald Trump.

The firm’s CEO Yang Guang, said then in a press release: “Our investment in SkyBridge is an important step in HNA Capital’s strategy to build a global asset management business.”

In Hong Kong, the group has spent about $3.5bn on residential land in Kai Tak. It has also recently opened HNA Innovation Finance Group, which focuses on commodity trading, consumer finance and financial investments, according to its press release.

Founded as Hainan Airlines in 1993, the group “has developed from a local aviation transportation operator to a conglomerate encompassing core divisions of aviation, hospitality, tourism, real estate, retail, finance, logistics, shipbuilding and eco-tech”, the firm stated on its website.

The ability of HNA Group to obtain large amounts of loans from state-owned Chinese banks and to conduct frequent overseas deals amid China’s tightening capital controls, has raised a question of the company’s links to the Chinese government, according to an earlier New York Times report.

Value Partners, also founded in 1993, had $15bn of assets under management as of 30 April. It focuses on China and value investing.

Following the change of its CEO in December, the firm is actively looking to expand its product suite as well as client base, according to its annual report. The plans include alternative investment capabilities, more multi-asset solutions, ETF business as well as robo-advisory services.

Value Partners launched its first global emerging markets fixed income fund in February this year. It is planning to launch Singapore’s first leveraged and inverse ETFs later this year, as reported earlier.


Part of the Mark Allen Group.