PineBridge, an asset management, is being sought for by Hong Kong billionaire Richard Lee, sources

PineBridge, an asset management, is being sought for by Hong Kong billionaire Richard Lee, sources

HONG KONG: According to three individuals with knowledge of the situation and a transaction document seen by Reuters, Pacific Century Group (PCG), the Hong Kong investment group founded by billionaire Richard Lee, is looking to sell its controlling share in asset manager PineBridge Investments.

Two of the individuals, who all wished to remain anonymous due to the confidentiality of the material, said that PCG has appointed JPMorgan to oversee the sale process and has had preliminary negotiations with a number of financial institutions.

By the end of 2023, PineBridge had over $157 billion in assets under administration, according to its website.

In 2010, Lee's PCG paid $277 million to US insurer American International Group for the company's New York headquarters, when it was managing $87.3 billion in assets.

While PCG did not immediately reply to a request for comment, PineBridge and JPMorgan refused to comment.

If the disinvestment is effective, PCG would leave the failing fund house in the face of increasing market volatility and fierce competition in the asset management industry, both of which have increased losses.

The Asia-Pacific area accounts for nearly 60% of PineBridge's portfolio, according to the offer document supplied with possible bidders. Rising interest rates and geopolitical concerns have pushed up regional real estate values.

The selling paperwork states that by the end of September, PineBridge would purchase the insurance company controlled by FWD, PCG, a Hong Kong-based company. PineBridge will manage about 25% of the company's assets.

The paper, which did not include figures for 2023, projects that the asset management would lose $78 million in 2022, compared to a profit of $15 million the year before.

With 25 branches, PineBridge employs over 700 people, including 230 investment professionals.

Although PCG has a majority share in PineBridge and intends to sell the whole investment, the asset manager's advisers, staff, and management together own a tiny minority ownership.

The selling agreement states that PCG may leave Huatai-PineBridge Fund Management, a lucrative joint venture in China that managed around one-third of the parent company's total assets, as a consequence of PineBridge's divestiture.

Pacific Century Premium Developments, a real estate developer, Hong Kong 5G provider HKT, media and telecoms conglomerate PCCW, and FWD, which has failed three times to issue its shares, are among PCG's other enterprises.

According to Hong Kong exchange documents, FWD's most recent application to list in Hong Kong expired in September. The company refused to comment.