UBS is the first foreign bank to increase its stake to a majority 51 percent in a China securities joint venture.
The Swiss bank received the approval from the China Securities Regulatory Commission to increase its shareholding in its securities joint venture in China, UBS Securities, from 24.99 percent to 51 percent, the bank said in a statement.
UBS is acquiring from China Guodian Capital Holdings and from state agricultural conglomerate Cofco their 12.01 percent and 14 percent stakes in UBS Securities respectively. Upon completing the transaction, UBS will become the first foreign bank to increase its stake to gain majority control of a securities joint venture in China.
Holistic Solutions
«This is a key milestone and an important part of our China strategy. Our close ties with UBS Securities, our investment banking arm in China, allow us to strengthen our collaboration with our operations across the region which is key to offering holistic solutions to our clients,» said Kathy Shih, president of UBS Asia Pacific.
UBS was the first foreign bank to apply to raise its shareholding in a China venture after CSRC's policy issued in April allowed foreign companies to take up to 51 percent stakes in securities firms in China.
Make Greater Contribution
Following the completion of the transaction, the shareholders of UBS Securities and their respective shareholdings will be: UBS AG (51 percent), Beijing Guoxiang Property Management (33 percent), Guangdong Provincial Communication Group (14.01 percent) and China Guodian Capital Holdings (1.99 percent).
«With majority control, we can better realize on the opportunities in China's capital markets and make a greater contribution to the UBS Group,» Eugene Qian, president of UBS Securities, added.
Industry First
«The further opening up of China's financial sector represents great opportunities for our wealth management, investment bank and asset management businesses. This step underlines our long-term commitment to this market and we will continue to pursue opportunities,» Sergio Ermotti, UBS CEO, said.
Last week French insurer Axa bought the 50 per cent of Chinese joint venture Axa Tianping that it did not already own, in a deal that was flagged as an industry first in China. Germany’s Allianz also said last week that it had gained approval to set up a wholly-owned holding company in the country.
