Fund manager Ashmore acquires Aviva’s stake in Chinese joint venture

Shanghai

British fund manager Ashmore Investment Management Ltd will acquire its competitor Aviva Investors’ 49% stake in a proposed Chinese joint venture with China Central Securities.

The UK fund manager has been seeking to grow its presence in China for some time and through this JV will get the chance to build a local fund management business, a spokesperson for Ashmore told AsianInvestor today.

He noted that the new entity will be based in Shanghai and operate under the name Ashmore-CCSC Fund Management Company, but did not provide any financial details regarding the transaction. The spokesman stressed that Chinese regulations forbid the creation of a wholly-owned foreign assets management firm. Ashmore has had an office in Beijing since 2010.

A spokesman for Aviva Investors in Singapore did not confirm the move to AsianInvestor.

Shanghai-based consultancy Z-Ben Advisors said it considers Ashmore’s planned partnership with China Central Securities to be risky due to insufficient funding. According to it, the parties will have a combined investment of CNY200m (USD31.6m/EUR24.5m), which is CNY100m less than what the advisor recommends as a minimum.

Z-Ben noted that since Ashmore targets the maximum foreign shareholding limit of 49% it would like to be actively involved in the venture.

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