China Jianyin Investment Ltd. (JIC) recently signed a JV agreement and articles of association for JIC Leasing Co., Ltd. (JIC Leasing). These documents were signed on June 27, 2015 together with the Carlyle Group, China Merchants China Direct Investments Limited (CMCDI) and JIC Technology Investment. Meanwhile, a capital injection agreement was also signed between JIC Leasing and the three above-mentioned strategic investors. Subject to customary closing conditions (including regulatory approvals and permits), the transaction is expected to officially close by the end of 2015. After the completion of this capital injection, Carlyle and CMCDI will invest roughly RMB 952 million together into JIC Leasing. They will then hold 25% of the company’s gross capital as foreign investors (Carlyle 18.54%, CMCDI 6.46%, JIC 74.96% and JIC Technology Investment 0.04%).
The Carlyle Group (NASDAQ: CG) is an alternative global asset manager with $193 billion in assets under management within 130 funds and 156 fund vehicles as of March 31, 2015. Carlyle invests across four segments – Corporate Private Equity, Global Market Strategies, Real Assets and Investment Solutions.
CMCDI, a unit of China Merchants Group, is an investment company that is traded on the Hong Kong Stock Exchange. CMCDI begin operations in 1993, specializing in quality Chinese investments. The company has now developed and acquired a number of diversified interests in various sectors, including: financial services, culture and media, manufacturing, energy and resources, information technology, agriculture, medical and pharmaceuticals, and education.
JIC leasing was founded in March 1989. It was one of the first finance leasing firms in China. The company has been on a business growth fast-track since a JIC-led restructuring that occurred in 2010. Its business portfolio has now expanded to include equipment manufacturing, information technology, healthcare and new energy products. Since 2010, JIC Leasing has reported an average compound annual growth rate of more than 75% for net profit and total assets. Bringing in strategic investors represents the company’s first step towards entering capital markets. On its way to public listing, JIC Leasing will further improve its shareholding structure. It will also seek to further develop exceptional corporate governance and good business performance.
As a state-run integrated investment group, JIC will be able to actively respond to state enterprise reforms by promoting shareholder diversification, corporate governance, market-oriented business models and state capital securitization among its member companies.
JIC will work closely with its strategic investors and apply a “win-win” philosophy towards streamlining its corporate governance system and market-driven business approach. The company also plans to sharpen expertise and management skills and build-up overall visibility and influence throughout the process of “going global”.
According to board chairman, Chen Youjun, JIC Leasing plans to bring together diversified resources from around the world. This is intended to fuel the company’s growth initiatives by focusing on core competency, global expansion and brand building.