Blackstone enters China

The global private equity firm has unveiled a new Hong Kong office co-led by Antony Leung, the region’s former financial secretary, and by Ben Jenkins, a top Blackstone dealmaker who will relocate to Asia. Schwarzman is ’impressed’ by China’s economic reforms.

The Blackstone Group today announced plans to expand its private equity investment business in the Asia Pacific region through a base in Hong Kong.

The Hong Kong office will be co-led by Antony Leung and Ben Jenkins. Leung was the financial secretary of Hong Kong from 2001 to 2003. Before that he was chairman of Asia for JP Morgan. Jenkins is a senior managing director at Blackstone in the New York office. He will relocate to Hong Kong where he will become the chairman of Blackstone Greater China.

Jenkins, who was named as one of 30 private equity “rising stars” in the July 2005 issue of Private Equity International, has been a key player in a number of high-profile Blackstone deals, including the €3.1 billion take-private of German chemical company Celanese and the $11.3 billion acquisition of SunGard. He joined Blackstone in 1999 after having worked at middle-market private equity firm Saunders Karp & Megrue.

Blackstone is a relatively latecomer to East Asia. The firm established an office in Mumbai in 2005 and a small office in Hong Kong related to the firm’s fund of hedge funds business. A number other major Western private equity firms have recently established China-facing investment platforms, including Bain Capital and Kohlberg Kravis Roberts. Texas Pacific Group recently subsumed its former Asian affiliate, Newbridge Capital, as part of the firm’s global expansion.

In a statement, Blackstone chief executive officer and co-founder Stephen Schwarzman said: “We are impressed by the impact of the economic reforms that have been taking place in the world’s fourth largest economy and elsewhere in the region. We believe that significant foreign direct investment in the Chinese economy is vital to its continued growth and development and look forward to playing an integral role in that process, not only in China but throughout the Asia Pacific region.”

In his statement, Jenkins called Asia Pacific “the most dynamic region in the world and the one that will have the most impact on the global economy in our lifetime”.