Chillin' out till it needs to be funded
Cai Jinyong is the 52 year old head of Goldman Sachs in China and while JP Morgan has got itself a few successes in setting up funds, and some others have successes in running IPOs for Chinese firms, with a ll the discussions on corporate accountability and reverse mergers from China leading accounting scams, Cai has been wondering if to take the risk of a China IPO mandate.
Of course this means he has not done any new business in arguably the world’s largest IPO market with luxury brands, brokers and big bad real estate among categories growing business apart from Dim Sum bonds and FIEs paying new penal taxes, like 13% duties imposed on GM for importing parts into China.
Goldman Sachs leads in the M&A lists in Investment Banking revenues this year and is seen working with Sprint for a T-Mobile ringer to close the year in which $ 73 bln in IB fees was generated with JP Morgan at $4.5 bln and GS nearer $3 bln
Goldman Sachs was the first Wall Street firm to get an underwriting license in China
“You’ve got to be selective deciding how to allocate your resources,” said Cai Jinyong, 52, who heads Goldman Sachs’s investment-banking business in China and is CEO of joint venture Goldman Sachs Gao Hua Securities Co. “We focus on clients who have the potential to be a leader or already are leaders. We need to sell quality companies to investors.”
Analysts at New York-based Goldman Sachs have forecast that the value of firms trading on Chinese bourses will swell to $41 trillion in 2030, surpassing the U.S. as the world’s largest equity market. Shenzhen, the smaller of China’s two exchanges, is the busiest IPO market in the world by number of deals, with 222 new listings this year, Bloomberg data show.
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