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Value Partners in fund distribution pact with Forbes

Hong Kong’s Value Partners has formed a strategic partnership to distribute funds with media company Forbes, which is branching into financial services.

Both firms signed a non-binding memorandum of understanding through Forbes’ subsidiary, Forbes Global Capital, to facilitate negotiations for a “global strategic partnership”, according to a joint statement from the firms.

As part of the intended partnership, Value Partners will act as the investment manager of Forbes-branded products, while Forbes will provide distribution support for the products in markets where it operates and has relevant licences.

A Hong Kong-based Forbes spokeswoman told FSA that although media is the flagship business of Forbes, it intends to diversify its business into financial services and real estate.

“Financial services will be a new focus, and the setting up of Forbes Global Capital is part of this initiative,” she said.

She was not able to comment on the current distribution capabilities of Forbes Global Capital, which is based in the US, noting that the firm is formulating new strategies and structures.

The financial services that the firm intends to provide may be more than the distribution of financial products, she added.

Value Partners expansion

King Au, Value Partners’ CEO, said during Fund Forum Asia in April that the firm favours forming strategic partnerships abroad, citing the firm’s relationship with a boutique manager in India, which he did not name.

“We want to grow that relationship and we want that partner to establish our presence in India, hopefully, in the near future,” he said.

Value Partners opened a Singapore office in 2014 and a London office in 2016. It also has a presence in Shanghai and Beijing.

The firm has been strengthening investment management capabilities in Singapore and established the office in London to extend its coverage of global emerging markets, according to Au.

He acknowledged that Value Partners is not well-known outside of Hong Kong or China. But with the inclusion of China in global indices, institutional investors will be pushed to invest more in the mainland, which he sees as an opportunity.

The asset manager has ambitions to become a China investment expert to investors globally, according to the joint statement.

Established in 1993, Value Partners managed assets of around $16.4bn as of the end of August.

The firm has had a spate of bad news recently. For the full year 2016, net profit plunged by 50% to HK$138m ($17.77m), and AUM was down 15% year-on-year.

In January, it was fined HK$4m by Hong Kong’s regulator for issuing shares exceeding the proper limit in two of its China funds.

However, its Chinese Mainland Focus Fund is one of the top 10 performing China funds over the trailing 10 years, with a cumulative 90% return.

Part of the Mark Allen Group.