China’s electronics retailing king partners Bear Stearns in private equity

Wong Kwong Yu, one of China’s richest men and founder of the country’s largest electronics retailer is partnering the private equity arm of Bear Stearns to launch an alliance to capture opportunities in China’s retail sector.

Eagle Investment Group, a Chinese investment firm has formed a private equity alliance with Bear Stearns, a US financial services group, to invest $500 million in China’s retail sector.

Eagle Investment, chaired by Wong Kwong Yu, founder of Gome, China’s largest electronic retailer, and Bear Stearns will each commit $250 million to toward an investment vehicle that will focus on China’s retail opportunities. In 1987, Wong established Gome, the largest retail business listed on Hong Kong stock exchange. The retailer attracted investment from Warburg Pincus last year.

Wong said: “With our years of retail experience in China, I am looking forward to working with the Bear Stearns Merchant Banking team as they extend their successful track record into China.”

Founded in 1997, Bear Stearns Merchant Banking, the private equity arm of Bear Stearns, has been investing in the US retail and consumer products sector. Its investments include Aeropostale, Balducci’s, Stuart Weitzman and Vitamin Shoppe Industries.

John Howard, chief executive officer of Bear Stearns Merchant Banking said Wong “will bring an extraordinary perspective.”

He added: “The retail sector is one of the leading growth engines behind the economic expansion in China and we look forward to investing in strong brands that can benefit from our firms’ combined expertise.”

Eagle Investment is a holding company that manages a number of investments across sectors including real estate, construction, pharmaceuticals, securities, asset management and IT.