China Life buys stake in TPG

The Chinese insurer has acquired a $250m interest in the private equity firm’s management company

One of the world’s largest insurance companies, China Life Insurance, has acquired a stake in global private equity firm TPG’s management company for $250 million, people familiar with the matter confirmed to Private Equity International.

China Life is now said to own between 2 percent and 5 percent of the business and joins the Government of Singapore Investment Corporation and Kuwait Investment Authority, who together with a group of investors took a 10 percent stake in the firm in 2011 for about $1 billion.

The move is a strategic partnership for the firms, giving TPG access to China Life’s network in China and the firm opening up opportunities for the PRC insurer across the globe.

The source could not comment more specifically on China Life’s investment plans overseas, but the move comes as Chinese buyers are increasingly looking offshore for cross-border M&A opportunities to diversify their investments.

For TPG, the deal comes as the firm is reportedly planning an initial public offering, which media reports say will be ready by 2016.

TPG declined to comment.

Investment into GPs by large investors globally has not been uncommon in recent years.

China Investment Corporation paid $3 billion for a 10 percent stake in The Blackstone Group in 2007, although its investment value fell by a third after the firm’s IPO later that year, according to a Financial Times report, which added that Blackstone says it has since recovered.

Singaporean sovereign wealth fund GIC and KIA have been active elsewhere, also, together purchasing a 10 percent stake in CVC Capital Partners in September 2012 with a third unnamed Asian investor, PEI reported earlier. GIC also has an investment in UK-based private equity firm Apax Partners.