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Citic Securities International (CSI) has been revealed as the investor. Hong Kong-based officials at CSI say their firm is keen to expand into asset management. Taking a stake in VisionGain represents the opening gambit.
CSI was jointly established in 2006 by the mainlandÆs Citic Securities and Citic Capital Holdings to focus on Greater China investment banking and securities brokerage businesses. It is meant as the parent companyÆs bridge to international markets and business. But its ambitions are not merely to expand across borders but to move into other sectors of finance.
Citic Group already has one cross-border asset-management specialist, Citic Capital, a $1.6 billion manager of hedge funds, private equity, real estate and structured finance. Founded in 2002, its parents are two Hong Kong-listed entities, the conglomerate Citic Pacific and Citic International Financial Holdings.
CSI officials say their move into asset management is independent of Citic CapitalÆs business.
In November 2007, CSI agreed to a strategic alliance with Bear Stearns, in which CSI would take 6% of Bear equity and Bear would get 2% of CSI stock, and the partners would set up a joint venture for an Asia business. That deal, which the parties are currently re-negotiating to deepen their mutual stakes, is independent of CSIÆs stake in VisionGain.
For VisionGainÆs partners, working with the international arm of ChinaÆs leading domestic investment bank brings obvious benefits, including a network of corporate connections and a source of research. VisionGainÆs investment strategy is based on interpreting BeijingÆs policymaking, so this kind of intelligence network is vital.
VisionGain also hopes to jointly develop offshore products in Hong Kong or other jurisdictions with CSI, in order to help it gain manufacturing and portfolio-management experience.
The AU$85 billion ($61.6 billion) Australian super fund has some exposure to indebted property developer Evergrande. Meanwhile, China’s construction finance is part of its core strategy in real estate.
Investors are seeing the risks, but also the opportunities of the logistics sector. Warehousing their fears for the moment, they can see it's a good conduit to high-growth assets.
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SGX’s new framework for Spacs will likely provide investors with a much-needed channel for direct deals, but the verdict is still out on whether it will bring liquidity to the bourse.