Industry Leader well-positioned to capitalize on growth of Financial Leasing in China
An investor consortium including affiliates of Kohlberg Kravis Roberts & Co. L.P. (KKR), Government of Singapore Investment Corporation (GIC) and China International Capital Corporation Limited (CICC) announced an investment of $160 million for a significant minority stake in International Far Eastern Leasing Company Ltd. (Far Eastern), the leading provider of financial leasing in China and a subsidiary of Sinochem Group (Sinochem). The investment will support Far Eastern`s future growth as it moves to capitalize on the attractive potential in the underdeveloped financial leasing space in China. Sinochem is retaining a controlling stake in Far Eastern.
“We are very excited to have world-class investors, including KKR as the lead investor, together with GIC and CICC, as long-term partners in Far Eastern’s development,” said Mr. Kong Fanxing, Chief Executive Officer of Far Eastern. “In addition to capital, their experience investing in and growing financial services businesses globally brings tremendous value to Far Eastern and will enable us to further develop our ability to provide integrated and innovative business services around our core business of financial leasing. This investment will also help support the Shanghai government`s long term goal to develop the city into a global financial and shipping center.”
Headquartered in Shanghai, Far Eastern is focused on providing innovative and industry-tailored financing solutions for its clients. The company targets sectors with stable cash flow and sustainable growth potential, including those in the medical, printing, education, infrastructure construction, shipping, machine tool sectors, etc.
“We are delighted to have the opportunity to invest in Far Eastern, the market leader in the financial leasing industry in China. We have been extremely impressed with the company’s strong track record, outstanding management team, deep customer relationships and a very supportive shareholder, Sinochem.” David Liu, Member of KKR and Head of KKR Greater China, said. “We look forward to fully utilizing our financial services industry expertise and global network to support the company as it continues to grow and develop into a world-class financial institution.”
“We are pleased to become a partner of Far Eastern Leasing and Sinochem. As a global investor, GIC has a long-term investment interest in China,” Liu Dong, head of GIC Greater China said. “We have extensive investment experience in China’s financial services industry and state owned enterprises. We would share our experience with Far Eastern and Sinochem and help accelerate the development of their businesses.”
“We are excited to have the opportunity to invest in a high-growth enterprise like Far Eastern led by a superb management team,” said Ms. Shirley Chen, Managing Director and Head of Private Equity of CICC. “We hope our expertise in capital markets and our understanding of China’s financial services industry and the development of its state owned enterprises, coupled with our network in China, will be helpful for Far Eastern’s future development.”
About International Far Eastern Leasing Co. International Far Eastern Leasing Co., Ltd. (Far Eastern), established in 1991, is a market leader in the financial leasing industry in China. Benefiting from the geographic advantages of Shanghai – the hub of finance, trade and shipping, Far Eastern has successfully integrated industry resources, trade services and financial capital to create a strong platform with excellent organizational and value-adding capabilities. It has now become the market leader in various industries including medical, printing, shipping, construction, machinery, education, etc.
By the middle of 2009, Far Eastern had signed leases with a total value in excess of 26 billion RMB. Headquartered in Shanghai, Far Eastern has one wholly-owned subsidiary and regional offices in Beijing, Shenzhen, Wuhan, Changsha, Jinan, Shenyang, and Chengdu. Its businesses cover 31 provinces across China.
Established in 1976, KKR is a leading global alternative asset manager. KKR’s franchise is sponsoring and managing funds that make investments in private equity, fixed income and other assets in North America, Europe, Asia and the Middle East. Throughout its history, KKR has brought a long-term investment approach, focusing on working in partnership with management teams of its portfolio companies and investing for future competitiveness and growth. KKR has more than $37.5 billion in private equity assets under management and more than $13.3 billion in credit assets under management as of June 30, 2009 through various private and publicly traded funds and separately managed accounts. KKR also carries out capital markets activities through its broker dealer subsidiaries. KKR has offices in New York, Menlo Park, San Francisco, Houston, Washington, D.C., London, Paris, Hong Kong, Tokyo, Beijing, Mumbai, Dubai and Sydney.
GIC is the private equity and infrastructure investment arm of the Government of Singapore Investment Corporation Pte. Ltd (GIC). GIC SI`s investments cover a wide spectrum and include leveraged buyouts, venture capital, growth capital, mezzanine financing, distressed situations, infrastructure and other special situation investments.
GIC is a global investment management company established in 1981 to manage Singapore`s foreign reserves. GIC invests internationally in equities, fixed income, foreign exchange, commodities, money market, alternative investments, real estate, private equity and infrastructure.
CICC is the first joint venture investment bank in China, established as a strategic partnership among prestigious Chinese and international financial institutions, with seven core business departments including Private Equity, Investment Banking, Capital Markets, Sales & Trading, Research, Fixed Income, and Asset Management. As of June 2009, CICC has successfully arranged US$ 155.4 billion in value of equity financing, US$85.3 billion in value of debt financing and over US$154.7 billion in value of mergers and acquisitions. CICC Private Equity has established two wholly owned investment arms, namely CICC Jia Cheng Investment Management Company Limited and CICC Investment Group, for domestic RMB and overseas USD investment respectively, with a focus on growth capital, pre-IPO and buyout investment opportunities.