Yunfeng Financial Holdings Ltd., a private-equity fund backed by e-commerce billionaire Jack Ma, will buy a 56 percent stake in Hong Kong-based investment bank Reorient Group Ltd., entering the city’s financial-services industry.
Jade Passion Ltd., controlled by Yunfeng, will buy 1.34 billion new shares in Reorient for HK$2.68 billion ($346 million), or HK$2 each, according to a Reorient statement to the Hong Kong stock exchange on Friday. It’s seeking exemption from a rule requiring it to make a mandatory buyout offer for Reorient.
“This is a strategic investment for us, very much in line with our endeavor in the financial technology space as well as in extending our global reach,” David Yu, Yunfeng’s chairman and co-founder, said in a press release. “We look forward to the joint exploration with Reorient in areas such as Internet finance.” Yu holds 60 percent of Yunfeng and Ma 40 percent, according to the statement.
Ma, chairman and founder of Alibaba Group Holding Ltd., China’s biggest e-commerce company, is boosting his investments in the financial services industry. He controls Zhejiang Ant Small & Micro Financial Services Group Co., which owns Alipay, China’s biggest online payment system, and operates a bank, a money-market fund and a credit-scoring service.
Among Yunfeng’s partners in Jade Passion is a company owned by Huang Youlong, who is the husband of Chinese actress Zhao Wei and an investor in Alibaba Pictures Group Ltd., Alibaba Group’s Hong Kong-listed entertainment arm.
Reorient said it will sell a total of 1.94 billion new shares, including those Yunfeng’s group is buying, raising HK$3.89 billion. It will use the money to support development of financial services operations and as general working capital.
All of Reorient’s executive directors except Johnson Ko and Brett McGonegal will resign on completion of the share sale, according to the filing.
Rorient’s shares, suspended since April 21, will resume trading in Hong Kong on Monday.