Weijian Shan, a former partner at TPG Capital and its leading dealmaker in China, is to become the chairman and chief executive officer of Pacific Alliance Group (PAG), effective 1 July, putting to rest speculation he was setting up his own buyout venture. He will be based in Hong Kong.
PAG and its affiliates manage about $5 billion across private equity, real estate, hedge fund and distressed investments. The firm has offices in Hong Kong, Shanghai, Beijing and Tokyo.
Shan will lead the effort to raise a new Asia-focused buyout fund at PAG, the firm said in a statement. The fund will focus on large-sized buyouts, structured transactions and strategic block investments and will be headed by Shan.
I originally planned to start my own fund rooted in and committed to Asia, but having subsequently come to know the founders of PAG and their investment platform, I decided instead to partner with them to grow a best in class private equity franchise.
, co-founder and managing partner of PAG and current CEO, will continue as Chief Investment Officer of the firm's hedge fund and distressed investment groups and will remain actively involved in the business, a PAG spokeswoman said.
“I originally planned to start my own fund rooted in and committed to Asia, but having subsequently come to know the founders of PAG and their investment platform, I decided instead to partner with them to grow a best in class private equity franchise,” Shan said in a statement.
The buyout fund “will be able to compete at the very top of the market”, a source told PEI Asia. The fund will invest on a pan-Asia basis including Australia and Japan and will have a major focus on China, the source said, adding that fundraising is due to begin as soon as possible.
PAG declined to comment on the specifics of the fund.
Shan will work closely with the firm’s various investment teams and will shape and oversee its strategy and development. He will continue to maintain a “business relationship” with TPG, whereby the global buyout firm will have certain rights to participate in co-investment and co-sponsorship opportunities. Shan will also continue as an advisor to a number of TPG portfolio companies, the firm said.
“We genuinely believe that we are at an inflection point for the alternative investment industry in Asia, with local firms now able to attract the very best in the industry. This partnership forms a key part of our plan to develop into the leading institutional platform in the region,” Gradel said in a statement.
PAG also recently appointed David Kim as a partner and chief operating officer of its pirvate equity business. Kim was formerly head of the Asia financial institutions group at Nomura International.
In his time at TPG, Shan led a number of landmark transactions for the firm in the region, including its acquisition of Shenzhen Development Bank – the first time a foreign investor had assumed a controlling stake in a Chinese bank.
Before joining TPG in 1998, Shan worked for five years at JP Morgan where he was a managing director and country head for China, serving as chief representative for the bank’s Beijing and Shanghai offices. Prior to working at JP Morgan, Shan was a professor at Wharton, University of Pennsylvania for six years.