HONG KONG/NEW YORK Blackstone Group's (BX.N) Ben Jenkins, a senior managing director and the firm's former top Asia dealmaker, is leaving the firm and returning to New York after four years in the region, two sources said.
Jenkins was Blackstone's top Asia manager until December, when the firm moved Michael Chae, a senior managing director in New York, to Hong Kong, to run the private equity unit there as well as to run relationships with Blackstone's investors in the region.
Jenkins' departure comes as competition for deals -- and the players who source them -- heats up in China's booming private equity market.
Asia is a key region for Blackstone and other private equity firms, which have been scouring the landscape for investments offering higher returns than those in slower-growing U.S. and European economies.
Competition among firms to employ the best dealmakers is high. Some major star dealmakers have left top firms to start up on their own.
Jenkins is moving back to New York to accompany his wife, who is taking a senior role in the United States with Carnegie Corporation, the sources familiar with the matter told Reuters.
Shiong Tan, a managing director in Blackstone's Private Equity Group in Hong Kong, is also leaving, two sources familiar with the situation said. It is unclear what he will be doing next, one of the sources said.
Jenkins will be leaving the company at the end of the year, according to one of the sources.
Jenkins, who was based in Hong Kong, arrived in Asia in 2007 and oversaw the buyout group's first investments across the region, including its $600 million investment in China's BlueStar Chemical, a subsidiary of ChemChina.
Its other investments in the region have included Dili, eMobile and China Animal Healthcare (0940.HK).
Blackstone declined to comment. The sources declined to be identified because they were not authorized to speak to the media and because the matter was not public.
Jenkins relocated to Asia from New York in the same year Blackstone hired Hong Kong's former Financial Secretary Antony Leung as senior managing director and greater China chairman, as the firm expanded its investing in the region.
Blackstone had opened its first office in Asia in Mumbai in 2006, at the height of the global credit boom, which drew U.S. private equity firms into the region in a hunt for assets.
China is the primary focus for global firms investing in Asia. Out of $16.2 billion private equity capital invested in Asia this year, $10.4 billion has been invested in China, recent Thomson Reuters data shows.
To accelerate investments in an increasingly competitive market, Blackstone and rival firms including TPG Capital TPG.UL, Carlyle, and the private equity arms of Goldman Sachs (GS.N) and Morgan Stanley (MS.N), are all raising local currency funds for China to accelerate investments.
Blackstone reached the first stage of capital raising for its 5 billion yuan fund in April. Elsewhere in the Asia Pacific region, Blackstone continues to invest from its global fund.
HOT HIRING MARKET
As China's private equity industry grows, a series of high-profile Chinese private equity executives have quit global firms to join start-up China-focused funds.
Global buyout firm TPG Capital TPG.UL has poached dealmakers from rival Bain Capital and from Goldman Sachs, as it set about rebuilding a team depleted by departures of high-profile executives Weijian Shan and Mary Ma.
Mary Ma left TPG earlier to set up Boyu Capital and is raising a fund of around $1 billion with Sean Tong, previously a managing director with Providence Equity Partners, and Louis Cheung, outgoing CEO of Ping An Group (601318.SS)(2318.HK).
Weijian Shan, meanwhile, in July had raised more than $1.7 billion under his new PAG Capital Asia private equity fund just months after the formal launch, underlining the attraction of investing in China with a known dealmaker. <ID: nL3E7IC0VI>
Jenkins, who grew up in the southern United States, spent 12 years with Blackstone. The December announcement detailing Chae's appointment said Chae would focus time on the firm's Asian investors, while Jenkins would continue to chase deals.
Jenkins was most recently focused on dealmaking in Australia, where Blackstone has been active in bidding for assets.
Earlier this year, it bought nearly 600 U.S. shopping malls from Australia's debt-laden Centro Properties CNP.AX for $9.4 billion in one of the biggest global property deals since the credit crisis.
However, Blackstone has also met with challenges on some deals there. The board of services firm Spotless Group SPT.AX rejected a A$657 million bid from Blackstone earlier this year.
The firm also narrowly failed to come to agreement on valuation for Australian aged-care homes company Japara, according to a source with direct knowledge of the matter.
(Reporting by Stephen Aldred and Megan Davies; Editing by Michael Flaherty, Anshuman Daga and Gunna Dickson)