TPG Capital's Asian unit sold the remainder of its stake in Ping An Insurance (Group), the mainland's second-biggest insurer, raising HK$9.1 billion, reaping big profits after a six-year investment in the country's financial industry.
Newbridge Capital sold all its 139.1 million H shares at HK$65.30 each, which is 1.5 per cent lower than the last closing price.
The sale was completed the day after Ping An became the biggest shareholder of Shenzhen Development Bank (SDB) with a 52 per cent stake. It was a significant step towards Ping An's goal of becoming a financial conglomerate with business covering insurance, banking and assets management.
Newbridge invested US$145 million to acquire 17 per cent of SDB in 2004 and exchanged that for 299 million shares - or 4 per cent - in Ping An last year. It had raised about US$1.24 billion selling 160 million shares of Ping An four months ago. After clearing the shares of Ping An, TPG earned a combined return of US$2.44 billion - 16 times their investment.
'Although there's still room for Ping An to grow, TPG has made a big enough profit selling its stake,' said Michiya Tomita, a Hong Kong-based fund manager for Mitsubishi UFJ Asset Management. 'It was a very good investment.'
JP Morgan lifted its target price for Ping An to HK$86 from HK$82 and maintained its 'overweight' rating.