European buyout firm Apax Partners, led by chief executive Martin Halusa, has been in talks with the Chinese government this week in an attempt to secure investment from the government’s sovereign wealth fund. If successful, his will be the first European firm to capitalise on sovereign wealth fund interest.
US private equity firm The Blackstone Group started the trend of private equity firms seeking backing from sovereign wealth funds. It sold a 10 percent stake in its management company for $3 billion (€2 billion) to funds controlled by the Chinese government, ahead of its initial public offering in July this year.
A person familiar with Apax’s negotiations said: “Halusa has been in China with a couple of other executives. The executives were gauging appetite for investment in Apax and one of the questions asked was whether a Blackstone-style arrangement was possible.” Other issues were discussed, he said.
The source said he believed all large firms were looking at securing an investment from a sovereign wealth fund. Apax declined to comment.
Blackstone has been followed by two of its US rivals in securing backing from a sovereign wealth fund. Last week, The Carlyle Group sold a 7.5 percent stake to an affiliate of Mubadala, the Abu Dhabi Government strategic investment and development company, for $1.35 billion in cash. The Abu Dhabi government also backed Apollo Management with a $1.5 billion investment.
Apax runs its Chinese operations from its office in Hong Kong.