GF Securities Co. plans to buy a 20% stake in Value Partners Group Ltd. from the asset manager’s founders, as part of a push by the mainland Chinese brokerage to expand overseas, people familiar with the deal said.
The Guangzhou-based brokerage is nearing an agreement to buy the stake from Cheah Cheng Hye and V-Nee Yeh for about HK$1.1 billion ($141 million), one of the people said, asking not to be identified. The deal is subject to board approval later this week, the person said.
Cheah and Yeh currently hold 25% and 16% of Value Partners, respectively, and would both retain a smaller share in the Hong Kong-based and listed firm. They founded the boutique fund manager in 1993 and it now has offices across China as well as in Kuala Lumpur, Singapore and London. It posted a loss of HK$544 million ($69.5 million) last year as its assets under management tumbled to $6.1 billion from $10 billion in 2021.
Value Partners confirmed in an exchange filing that talks on the stake sale are ongoing.
The deal is being made through GF Holdings (Hong Kong) Corp., a subsidiary of GF Securities, one of the people said. The purchase price represents more than a 35% premium to the last close of Value Partners, which has tumbled over 35% since late January.
GF Holdings is trying expand its presence outside of China after restructuring last year as it hired Charles Lin, a former CLSA Ltd. and Vanguard executive, to steer the business.
The Value Partners founders had tried to sell a stake to HNA Group Inc. in 2017 in a deal that later fell through.
(Adds Value Partners confirmation of talks in fourth paragraph)
