Hong Kong billionaire Richard Li seeks to sell asset manager PineBridge -sources (updated)

Pccw

02/02/2024 09:59

(Updates Feb. 1 story to add company comment in paragraphs 6-8,
2023 financial performance in paragraph 13)
    By Selena  Li and Kane Wu
       HONG KONG, Feb 1 (Reuters) - Hong Kong investment firm
Pacific Century Group (PCG), founded by billionaire Richard Li,
is seeking to sell its majority stake in asset manager
PineBridge Investments, according to four people with knowledge
of the matter and a deal document seen by Reuters.
    PCG has hired JPMorgan  JPM.N  to run the sales process and
has held preliminary discussions with a number of financial
institutions, said two of the sources. All of the sources
declined to be named because the information is confidential.
    PineBridge managed assets worth about $157 billion at the
end of 2023, according to its website. 
    Li's PCG acquired the New York-headquartered business from
U.S. insurer American International Group  AIG.N  in 2010 for
$277 million, at a time when it managed $87.3 billion of assets.
    PineBridge and JPMorgan declined to comment.
    A spokesperson for PCG on Friday declined to comment on its
move to offloading a stake in PineBridge at the group level.
    However, the spokesperson added PCG doesn't plan to sell
stakes in PineBridge's joint venture with Huatai in China and
PCG remains committed to the market.
    A profitable China joint venture, Huatai-PineBridge Fund
Management accounted for about one-third of the parent's total
assets under management, according to the sales document.
    The divestment, if successful, would see PCG exit from a 
money-losing fund house amid heightened market volatility and
intense competition in the asset management business that has
contributed to the losses.
    Close to 60% of PineBridge's portfolio exposure is to the
Asia-Pacific region, according to the deal document shared with
potential bidders. Rising interest rates and geopolitical
tensions have roiled regional asset prices.
    PineBridge managed about 25% of the assets of Hong
Kong-based FWD, an insurance business owned by PCG, as of
end-September, according to the sale document.
    The asset manager swung to a loss of $78 million in 2022
from a $15 million profit the prior year, according to the
document, which did not provide 2023 results. 
    The asset manager's net profit after tax in 2023 was over
$40 million, according to one of the sources. PCG declined to
comment on the financial performance.
    PineBridge has more than 700 employees across 25 offices,
including 230 investment professionals.
    While PCG has a controlling stake in PineBridge and is
looking to exit all of its holding, the asset manager's
management, employees and advisers together hold small minority
interests.
    PCG's other businesses include FWD, which has failed three
times to float its shares, telecom and media group PCCW
 0008.HK , Hong Kong 5G provider HKT, and property developer
Pacific Century Premium Developments  0432.HK . 
    FWD's latest application to list in Hong Kong expired in
September, filings from Hong Kong bourse showed. FWD declined to
comment. 

 (Reporting by Selena Li and Kane Wu; Editing by Jamie Freed and
David Evans)
 ((kane.wu@thomsonreuters.com; +85228436590; Reuters Messaging:
kane.wu.thomsonreuters.com@reuters.net))