China International Capital Corporation Ltd. (CICC) has signed an agreement to acquire a 50.1% stake in US asset management firm Krane Funds Advisors, LLC (KraneShares), in a move that will allow the Beijing-based investment bank to expand into the US asset management industry.
The companies announced the deal in a June 10 statement, but did not disclose the financial terms. A CICC spokeswoman declined to provide further details when asked by Asia Asset Management.
The acquisition aims to “combine CICC’s extensive global research, investment and wealth management platforms with KraneShares’ ETF [exchange-traded fund] expertise”, the companies say in the joint statement.
New York-based KraneShares specialises in China-focussed ETFs. According to the company, it was the first to issue an MSCI-linked China A-share ETF in the US.
Bi Mingjian, acting chairman and chief executive officer (CEO) of CICC, who describes the bank as having “unique international DNA”, sees the partnership as an opportunity for the two companies to grow their business in the US and globally.
“Our entry into the US asset management and ETF industry with KraneShares’ platform represents a remarkable opportunity for us to provide high quality investment products and services to our clients, including individuals, advisors, and institutions, domestically and overseas,” Mr. Bi says in the statement.
KraneShares’ CEO Jonathan Krane adds that the companies “share the same mission of building a trusted bridge of financial knowledge and expertise between the US and China”.
“We believe the combined company will be the premier source for China investment products and research globally,” he says.
CICC was founded in 1995 as a joint venture between China Construction Bank and Morgan Stanley. Its global shareholders include Beijing-based sovereign wealth fund China Investment Corporation, Singapore sovereign wealth fund Government of Singapore Investment Corporation, and private equity firms TPG and KKR. The company was listed in Hong Kong in 2015.
