Goldman Sachs takes full ownership of China joint venture
18 October 2021 China
Image: SeanPavonePhoto/stock.adobe.com
Goldman Sachs has announced it will take full ownership of Goldman Sachs Gao Hua Securities Company (GSGH) after being granted approval by the China Securities Regulatory Commission (CSRC).
In an email sent across the company, Goldman Sachs confirmed it will acquire the remaining equity interest in GSGH that it does not currently own. The move “marks the start of a new chapter for our China business following a successful 17-year joint venture,” says the bank.
With the migration of Goldman Sachs’ onshore business units from Beijing Gao Hua Securities well underway, the acquisition of GSGH will enable the company to position itself for long-term growth and success in the market.
As a wholly foreign-owned entity, GSGH will be renamed Goldman Sachs (China) Securities Company.
The email sent signed by David Solomon, John Waldron and Stephen Scherr, reads: “As we continue to invest in our China franchise, we would like to take this opportunity to thank everyone involved in the application and migration processes for their extraordinary effort put into achieving this milestone, as well as the people who have contributed to the success of our China business over the years.”
Goldman Sachs becomes the second Wall Street firm to take full ownership of its securities business in China, after J.P. Morgan Chase was granted approval to do so in August.
These moves from the US banks follow China’s decision in 2020 to scrap the limits it previously imposed on foreign ownership in the financial industry.
Subsequently, the CSRC has removed limits to foreign stakes in futures, mutual fund and securities companies, enabling foreign companies to take full ownership.
UBS was the first foreign bank to take majority ownership in a China-domiciled joint venture, assuming a 51 per cent stake in its JV in 2018.
In an email sent across the company, Goldman Sachs confirmed it will acquire the remaining equity interest in GSGH that it does not currently own. The move “marks the start of a new chapter for our China business following a successful 17-year joint venture,” says the bank.
With the migration of Goldman Sachs’ onshore business units from Beijing Gao Hua Securities well underway, the acquisition of GSGH will enable the company to position itself for long-term growth and success in the market.
As a wholly foreign-owned entity, GSGH will be renamed Goldman Sachs (China) Securities Company.
The email sent signed by David Solomon, John Waldron and Stephen Scherr, reads: “As we continue to invest in our China franchise, we would like to take this opportunity to thank everyone involved in the application and migration processes for their extraordinary effort put into achieving this milestone, as well as the people who have contributed to the success of our China business over the years.”
Goldman Sachs becomes the second Wall Street firm to take full ownership of its securities business in China, after J.P. Morgan Chase was granted approval to do so in August.
These moves from the US banks follow China’s decision in 2020 to scrap the limits it previously imposed on foreign ownership in the financial industry.
Subsequently, the CSRC has removed limits to foreign stakes in futures, mutual fund and securities companies, enabling foreign companies to take full ownership.
UBS was the first foreign bank to take majority ownership in a China-domiciled joint venture, assuming a 51 per cent stake in its JV in 2018.
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