HONG KONG (Reuters)) - Fosun international Ltd (0656.HK), China’s largest private conglomerate, is in talks to acquire a stake in Russian investment bank Renaissance Capital, two sources familiar with the matter told Reuters.
The talks about the stake in Renaissance Capital, owned by Russian billionaire Mikhail Prokhorov’s Onexim Group, have been under way for a couple of months.
The value of the transaction is still under discussion, according to the sources, who declined to be named as the matter was confidential.
Russian business daily Vedomosti first reported the deal this month, citing sources as saying Fosun will potentially become a minority shareholder, investing together with Prokhorov, and receive an option to increase its stake as the investment bank’s business expands and its profit rises.
Renaissance Capital specialises in emerging and frontier markets. One of its core markets is Africa where it has offices in countries including Kenya and Nigeria.
The potential deal comes as Shanghai-headquartered Fosun shifts its investment focus to emerging markets, notably India, Russia and Brazil, where valuation of assets is lower.
Fosun did not reply to Reuters’ request for comment. Renaissance Capital declined to comment.
“Fosun has roughly completed the investment layout in developed countries, and now it needs to turn to emerging markets,” its billionaire co-founder and chairman Guo Guangchang said at a post-earnings media briefing on Wednesday.
Guo also said Fosun would provide information about the next round of funding plans for its healthcare assets before the end of the year. The company is still considering either an IPO or private equity financing, he added.
In Russia, Fosun has already set up two subsidiaries - Fosun Management (Russia) and Fosun Eurasia Capital - to seek investment opportunities and build its asset management business in the country and neighboring regions, its website shows.
Fosun posted a 21.4 percent rise in first-half net profit to 4.39 billion yuan ($660 million), led by gains from its investments in healthcare and tourism-related businesses, it said late on Tuesday. Revenue surged 9.3 per cent to 32.5 billion yuan.
Reporting by Julie Zhu; Additional reporting by Kira Zavyalova and Alexander Winning; Editing by Denny Thomas and Adrian Croft