Wholly foreign-owned securities firm surfaced: it intends to buy all the shares of Goldman Sachs Gaohua, and Goldman Sachs said it has reached an agreement

The Paper's reporter Sun Mingwei

On December 8, there was market news that Goldman Sachs Group had reached an agreement to acquire 100% of its joint venture in China, Goldman Sachs Gaohua Securities Co., Ltd. (hereinafter referred to as "Goldman Sachs Gaohua"). In this regard, the Goldman Sachs spokesperson confirmed the news to the surging news reporter.

This means that Goldman Sachs Gaohua may become the first wholly foreign-owned securities firm in China.

On March 27, Goldman Sachs announced that it had been approved by the China Securities Regulatory Commission to increase its stake in Goldman Sachs from 33% to 51%.

At the same time, Todd Leland, co-president of Goldman Sachs Asia Pacific (excluding Japan), said of the approval: "This is an important milestone in the development of our business in China. Specifically, once we have obtained a majority stake, we can proceed to prepare for the restructuring of the entity structure of our business in China. We will seek to relocate and consolidate all of our business and management departments operating at Beijing Gaohua Securities into a single corporate entity, Goldman Sachs Gaohua, as soon as possible. At the same time, we will also seek to achieve 100% ownership as soon as possible. ”

For more than 20 years, Goldman Sachs has been actively involved in China's capital markets. According to Deallogic, Goldman Sachs ranked ahead of other international investment banks in 2018 and 2019 on A-share stocks and stock-related offerings.

Founded in 2004, Goldman Sachs Goldman Co., Ltd. is a joint venture between Goldman Sachs and Beijing Gaohua Securities Co., Ltd., which was established in the same year.

According to the official website of the Csrc, the shareholder change application submitted by Goldman Sachs Gaohua was accepted on August 19, 2019, accepted on November 1, 2019, and received the first feedback on January 20, 2020.

With China's continuous opening up to the outside world, a number of foreign-controlled and participating securities companies have accelerated their efforts to seize the Chinese market. In 2018, China announced that it would relax the limit on the proportion of foreign investment in joint venture securities, fund management and futures companies to 51%, and no longer set the limit after three years. On 28 April of that year, the CSRC issued the Administrative Measures for Foreign-Invested Securities Companies, allowing foreign investment to hold joint venture securities companies, and at the same time making it clear that the business scope of joint venture securities companies will be gradually liberalized.

Subsequently, UBS Group took the lead in announcing on December 1, 2018 that it would increase its shareholding in UBS Securities from 24.99% to 51%, becoming the first foreign financial institution to realize the control of a joint venture securities company.

On March 29, 2019, the China Securities Regulatory Commission (CSRC) announced that it had recently approved the establishment of J.P. Morgan Securities (China) Co., Ltd. and Nomura Oriental International Securities Co., Ltd. in accordance with the law, and the controlling shareholders of the two companies were JPMorgan Chase & Co. in the United States and Nomura Holdings in Japan.

On 13 March 2020, the CSRC announced that with effect from 1 April 2020, the foreign ownership restrictions on securities companies will be lifted, and eligible foreign investors may submit applications for the establishment of securities companies or changes in the actual controllers of securities companies in accordance with the requirements of laws and regulations, relevant provisions of the CSRC and relevant service guidelines. The arrival of this policy is 8 months ahead of the SFC's issuance on October 11, 2019.

On March 27, Morgan Stanley said that after the completion of the transaction, Morgan Stanley's shareholding in Morgan Stanley Huaxin Securities will rise from 49% to 51%.

On August 21, the China Securities Regulatory Commission (CSRC) approved the establishment of Daiwa Securities (China) Co., Ltd., in which Daiwa Securities Group Corporation holds 51% of the shares, and the two domestic shareholders hold a total of 49%.

On the evening of September 1, the official website of the China Securities Regulatory Commission showed that DBS Securities (China) Limited had approved its establishment on August 27.

So far, there have been 8 foreign-controlled securities companies in Chinese mainland, of which 4 are newly established joint venture securities companies, and the other 4 are foreign shareholders who have obtained controlling rights by increasing their shareholding ratio.

Editor-in-Charge: Wang Jie

Proofreader: Luan Meng