TPG Said to Seek Asia Chairman to Assist Expansion in China
TPG Capital, the buyout firm that manages $48 billion, is seeking a chairman for its Asian operations to help it compete for investments in China, said three people with knowledge of the matter.
The Fort Worth, Texas-based company wants a Chinese speaker and has held discussions with several candidates, the people said, asking not to be identified because the process is private.
TPG has invested $8.1 billion in Asia since the start of 2008, more than Carlyle Group and KKR & Co., according to estimates by the Asian Venture Capital Journal. Two senior TPG managers, Shan Weijian and Mary Ma, left in the past year to join other asset managers.
In China, Asia’s biggest private-equity market over the past three years, foreign buyout firms are facing stiffer competition from local rivals, as former executives at Goldman Sachs Group Inc. and Ping An Insurance (Group) Co. set up their own funds.
Ma, the former Lenovo Group Ltd. (992) chief financial officer who joined TPG in 2007, quit this year to help ex-Ping An President Louis Cheung start private equity firm Boyu Capital Ltd. Hong Kong billionaire Li Ka-shing’s charity foundation said last month it agreed to invest in a Boyu Capital fund.
Tim Payne, a spokesman for TPG at public relations firm Brunswick Group in Hong Kong, declined to comment.
TPG, founded by David Bonderman and Jim Coulter, in the past six years bought stakes in Chinese companies in industries ranging from solar energy to supermarkets and finance. It has also announced two yuan-denominated funds in the Chongqing municipality in central China and Shanghai, following Carlyle and Blackstone Group LP (BX) in raising money in the Chinese currency.
The firm’s Asia-Pacific team is currently led by Hong Kong- based Stephen Peel, who took over from Dan Carroll in 2009 when Carroll returned to San Francisco after spending three years in Asia. Timothy Dattels, a partner at TPG, helps oversee investments in Asia while spending most of his time in San Francisco.
Shan Weijian, a former partner in TPG’s Hong Kong office, left last year to join Pacific Alliance Group, an Asia-based alternative investment manager, as chairman and chief executive officer. Shan helped TPG buy a stake in China’s Shenzhen Development Bank Co. (000001) in December 2004, one of the company’s most profitable investments in Asia.
TPG sold its stake in the lender in 2009 to Ping An, China’s second-biggest insurer. The fund has since raised $2.44 billion by selling Ping An shares it received in the deal. TPG’s Newbridge Capital LLC paid about $145 million for the Shenzhen Bank stake in 2004.
Carlyle invested $6.2 billion in the region since the beginning of 2008 and KKR made $6.4 billion of deals in the same period, AVCJ estimates. Some 19% of TPG’s Asian investments were in China, compared with 14 percent for Carlyle and 24 percent for KKR, according to the researcher.
In the past seven months, TPG bought stakes in China International Capital Corp., the first Sino-foreign investment bank; Comtec Solar Systems Group Ltd.; and Hong Kong Energy Holdings Ltd., a developer of renewable-energy projects focusing on China.
Private-equity investments in China jumped 40 percent to $19.7 billion last year, according to AVCJ. The nation accounted for 37 percent of Asian deals last year, an increase from 29 percent in 2009, the researcher estimates.
TPG last month sold a minority stake to the Government of Singapore Investment Corp. and the Kuwait Investment Authority, using the proceeds to finance expansion of new and existing lines of business and into emerging markets, according to a person briefed on the decision.
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