China Universal’s rebranding may pave way for listing

13 November 2013   Category: News, Asia, China   By Asia Asset Management

China Universal announced on November 9 that it has revised its official name to ‘China Universal Asset Management Co Ltd’ from ‘China Universal Asset Management Ltd’. Though seemingly minor, the change suggests the company may be preparing to list on the Mainland stock market.

The move comes after revisions to the ‘Law of Securities Investment Funds’ launched by the China Securities Regulatory Commission (CSRC) were implemented on June 1. The CSRC move encourages local asset managers to go public by enforcing a shareholding system for companies that use the ‘Co’ designation.

In light of the rule, the market watchdog consulted market participants regarding measures that might formulate supervisory requirements for the public listing of asset management firms. Of note, an individual shareholder with a less than 5% stake in a Mainland asset manager can be exempted from CSRC’s approval.

The CSRC initially unveiled the shareholding scheme in 2007, but it subsequently scrapped the plan because of issues relating to market risk, the usage of IPO fundraising, pricing, and market maturity. The scheme’s resurrection has come about thanks to the continued maturing of the market there.