JPMorgan poised to be first foreign company to own majority stake in China mutual fund venture
- Firm currently owns 49 per cent of China International Fund Management and could snap up 2 per cent stake for sale by Shanghai International Trust
- Lack of access to China market for foreign companies is a major area of contention in US-China trade dispute
JPMorgan could become the first foreign company to own a majority stake in its Chinese mutual fund business, after its joint venture partner put a crucial 2 per cent of the business up for sale that analysts expect the Wall Street bank to lap up.
A move by JPMorgan towards that goal would come at a tense time in US-China ties, as Chinese Vice-Premier Liu He is set to continue trade negotiations with the United States that were roiled after US President Donald Trump said on Sunday he would raise tariffs.
Under new rules announced in late 2017, foreign asset managers can own up to 51 per cent of their Chinese mutual fund joint ventures, though, so far, no company has managed to do so.
JP Morgan Asset Management (JPMAM) currently owns 49 per cent of China International Fund Management (CIFM), while Shanghai International Trust, belonging to Shanghai Pudong Development Group, owns 51 per cent.
Shanghai International Trust said in a posting on the Shanghai United Assets and Equity Exchange website it is auctioning a 2 per cent stake.