Private equity giant KKR & Co completed the registration of its wholly-owned fund management unit on March 8 with the Asset Management Association of China (AMAC), which oversees the country’s fund industry.
The subsidiary, named KKR Investment Management (Shanghai) Co., Ltd., is 100% owned and invested by KKR Capital Markets Asia, according to AMAC data and KKR’s company website. The Shanghai-registered fund manager, which will manage no more than 500 million yuan ($69.5 million) in assets, is the KKR’s second private fund management unit being registered with the AMAC.
AMAC stipulates that private fund managers register their fund management units with the regulatory body within 12 months from the date of industry and commerce registration, except for the cases where the registration is suspended due to policy changes, according to a legal commentary published by Chinese law firm Han Kun Law Offices.
The registration comes around five months after Ming Lu, the executive chairman for the Asia Pacific region at KKR Asia Limited met with Zhou Xiaoquan, head of the Shanghai Municipal Financial Regulatory Bureau. Zhou invited the PE firm to set up an RMB-denominated investment platform and apply via the Qualified Domestic Limited Partner (QDLP) scheme in Shanghai.
In April 2022, KKR registered— KKR Investment Management (Hainan) Co., Ltd.—another wholly-owned fund management unit with the AMAC under the QDLP programme, per the AMAC data. QDLP enables the PE firm to raise capital from mainland China to invest in overseas markets.
The New York-listed private equity group started its APAC expansion with offices in Hong Kong and Tokyo in 2005. The opening of its Shanghai office in 2017 marked the third office in Greater China and the eighth in Asia Pacific.
Some of KKR’s portfolio companies in China include ByteDance, the parent of short video app TikTok; online classifieds platform 58.com; and veterinary hospital chain Ruichen Pet Hospital Group.
KKR is not the only PE behemoth ramping up its presence in the world’s second-largest economy.
Canada’s Brookfield Asset Management, which has over $900 billion in assets under management, also completed the registration of Brookfield (Shanghai) Private Funds Management Co., Ltd., a wholly-owned fund management unit under the asset manager’s Brookfield Advisors (Hong Kong) Limited, on March 8.
