Asia continues to lag other regions for integrating ESG principles with investing; better data and stronger regulatory requirements will help institutional investors, market observers say.
Ma has been with Lenovo, China's largest computer manufacturer and ranked one of the top three in the world, since 1990. She held the post of senior vice president, executive director and CFO from 1997 onwards.
Ma resigned earlier this year and did not cite a reason. TPG's global communications firm Owen Blicksilver Public Relations confirms that "Mary's decision to leave Lenovo preceded any discussions with TPG".
One source familiar with the company says that Ma was probably tired of the power struggles between the US managers Lenovo poached from rival Dell and the Chinese managers. "She was the only woman, the only Chinese and the only 'old' Lenovo person on the board," adds the source.
The US managers, including current CEO Bill Amelio, were brought in to internationalise the management after Lenovo bought the personal computer division of IBM in 2004. Yang Yuanqing, the chairman of Lenovo, is also mainland Chinese. But he is removed from the day-to-day operations of Lenovo.
Ma has been interested in the investment side of things for a long time and saw TPG as a great fit, says the source.
TPG has more than $30 billion under management. At TPG, Ma will focus on China business. "TPG made a lot of money on their investment in Shenzhen Development Bank. So they are confident about China. They just want a strong, capable leader," he adds. Ma, with her cross-cultural abilities and her deep mainland connections makes a great choice, he says.
Ma was also recognised as one of Lenovo's key contact points with the international investment community during her long innings as CFO. "Mary will likely focus on larger deals but is likely to work with all parts of TPG," says Blicksilver. "She will not be building an independent team and is likely to work most closely with TPG partner, Weijian Shan."
Ma is known as a savvy negotiator and one of the driving forces behind LenovoÆs acquisition of IBM's PCD for $1.75 billion, one of the largest-ever overseas acquisitions by a Chinese firm. Via the deal, Lenovo gained international brand recognition and moved from being largely a desktop player, into the faster growing and more technology-intensive notebook computer market. The jury is still out, however, on the acquisition with some analysts saying that Lenovo overpaid.
"Technology will clearly be an important sector for Mary (given her background with Lenovo)," says Blicksilver, "but she brings investment and operational skills to businesses beyond technology."
TPG, along with Newbridge and General Atlantic Partners, invested $350 million in Lenovo in 2005 to part-finance the IBM PCD deal and got two board seats in the Chinese firm, along with a 12.4% equity stake. TPG was the largest investor, committing $200 million. Presumably, this was when TPG got an in-depth knowledge of and appreciation of MaÆs working style.
Ma got a bachelorÆs degree from Capital Normal University in Beijing in 1976 and also studied at Kings College of the University of London. Before joining Lenovo, Ma worked at the Chinese Academy of Sciences, managing science and technology research projects jointly developed by Chinese and European firms.
James G Coulter, founding partner of TPG, in a written statement referred to Ma as an ôexperienced operator and a talented dealmakerö.
This appointment follows similar steps taken in 2007 by Blackstone and CVC.
Blackstone announced in January that it would open a private equity office in Hong Kong and that Antony Leung, who was financial secretary of Hong Kong from 2001 to 2003, would co-head the office. His primary role is to source and manage deals in Greater China.
Antony is a former banker. He has immediately put his deal-making skills to work for his new employer and is credited with helping structure the May 2007 deal whereby the Chinese government invested $3 billion in BlackstoneÆs IPO. At current market prices China Inc. has eroded one third of its capital on this investment as Blackstone now trades around $21, down from the $31 issue price at which shares were acquired.
In July, Blackstone Advisory advised China Development Bank on the acquisition of a 3.1% stake in Barclays Bank for Ç2.2 billion ($3.03 billion) representing a price of ú7.20 ($14.80) per share. The investment added firepower to BarclaysÆ bid for ABN AMRO. Barclays closed on September 7 at ú5.82. The Barclays investment fares better than the Blackstone one, as it is down only 20%.
Blackstone is also close to finalising its first China investment, acquiring a stake in chemicals company Blue Star for around $500 million.
After Blackstone's Antony Leung hire, CVC in August appointed Francis Leung senior advisor with a similar mandate as Blackstone gave Antony. CVC has $23 billion of PE funds under management.
Francis is a well-known Hong Kong investment banker, who was previously chairman of Asia for Citi Global Markets. He was in the news through 2006 as he sought to buy Richard LiÆs controlling interest in PCCW. The deal was aborted in November.
Ma's role is likely to be somewhat different from that of both Leungs. Noteworthy that Ma joins TPG as a partner. Also, Ma with her mainland China background and extensive experience of working in a senior management role with a Chinese firm will probably play a pivotal role in TPG's Mainland strategy.
Despite the differences, the steps taken by TPG and earlier by Blackstone and CVC point to one common factor û financial sponsors are seeing a need for senior professionals with proven China experience to help them navigate their way to success in the country. Thus far, private equity has had a mixed experience in China with ôgrowth capitalö type investments, representing minority stakes in non-strategic sectors flourishing, but buyout deals facing roadblocks.
It is now widely recognised that success in China is predicated upon a cultural understanding of the way business is done in one of the world's fastest-growing economies. "Guanxi" or relationships are critical to this. The three firms - and many others - are hoping that the 'seasoned China hands' they have hired will give them this edge and thus a competitive advantage in sourcing and closing deals.
Korea Teachers' Credit Union appoints new CIO; AIA Singapore hired ESG head from UOB; Ping An confirms appointment of Benjamin Deng as CIO; Australian Unity hires first head of responsible investment; AMP has new head of portfolio management for multi-assets, Robeco hires Asia fixed income head; Haitong makes three new appointments for institutional clients business; and more.
After two tenures, AsianInvestor's 2021 Standout CIO Jang Dong-hun looks back on the past six years at Korea's Poba with satisfaction.
Risks including property downturn and ongoing pandemic make for difficult investment decisions.
As a pioneer in the Australian super space, CSC continues to focus on core objectives while taking calculated risks in an uncertain macro-economic environment.