JPMorgan’s asset management arm will have to pay a 33 per cent premium to take control of its Chinese joint venture, setting an expensive precedent for other international fund managers as foreign institutions race to tap China’s $5.3tn market.
An exchange filing by JPMorgan’s local partner Shanghai International Trust disclosed a net asset valuation from an external third party of Rmb9bn ($1.3bn) for the JV, China International Fund Management (CIFM). But the filing set a minimum bid price for the 2 per cent stake on auction at Rmb241m, which instead values CIFM at Rmb12bn.
JPMorgan Asset Management declined to comment on the filing by Shanghai International Trust, which is owned by state-run Shanghai Pudong Development Bank. But the US fund manager has previously said it wants to take a controlling stake in the joint venture.