Singapore firms keen on CICC stake
By Pan Xiaoyi |
December 3, 2010, Friday
|
Print Edition
Print Edition
SINGAPORE'S sovereign wealth fund and OCBC are reportedly joining the bid for Morgan Stanley's 34.3 percent stake in China International Capital Corp.
Earlier reports said private equity firms Kohlberg Kravis Roberts & Co and TPG Capital will buy about 10 percent of shares in CICC, China's top investment bank.
Morgan Stanley will sell a 5 percent stake to Great Eastern, the insurance arm of Singapore-based Oversea-Chinese Banking Corp (OCBC). The Government of Singapore Investment Corp, which holds 7.35 percent now, will take the remainder, Bloomberg News yesterday cited four people with direct knowledge of the deal as saying.
Morgan Stanley will reap about US$1 billion from disposing the 34.3 percent stake while it spent just US$37 million to help set up CICC in 1995.
The United States investment bank has long sought to sell its stake in CICC so that it will be able to form a joint venture with Shanghai-based China Fortune Securities. Chinese law does not allow foreign companies to have two jointly owned investment companies at the same time.
Morgan Stanley had signed a memorandum of understanding with China Fortune to form a venture at the end of 2007. But the attempt to sell the stake in 2008 fell through due to the fallout of the financial crisis. China Fortune planned to invest 680 million yuan (US$101 million) to set up an investment bank with Morgan Stanley. China Fortune will take a two-third stake in the venture.
Earlier reports said private equity firms Kohlberg Kravis Roberts & Co and TPG Capital will buy about 10 percent of shares in CICC, China's top investment bank.
Morgan Stanley will sell a 5 percent stake to Great Eastern, the insurance arm of Singapore-based Oversea-Chinese Banking Corp (OCBC). The Government of Singapore Investment Corp, which holds 7.35 percent now, will take the remainder, Bloomberg News yesterday cited four people with direct knowledge of the deal as saying.
Morgan Stanley will reap about US$1 billion from disposing the 34.3 percent stake while it spent just US$37 million to help set up CICC in 1995.
The United States investment bank has long sought to sell its stake in CICC so that it will be able to form a joint venture with Shanghai-based China Fortune Securities. Chinese law does not allow foreign companies to have two jointly owned investment companies at the same time.
Morgan Stanley had signed a memorandum of understanding with China Fortune to form a venture at the end of 2007. But the attempt to sell the stake in 2008 fell through due to the fallout of the financial crisis. China Fortune planned to invest 680 million yuan (US$101 million) to set up an investment bank with Morgan Stanley. China Fortune will take a two-third stake in the venture.
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