Blackstone China Unit Receives nod to Raise Funds for Overseas Investments

Blackstone's newly formed China unit has received regulatory approval to raise funds for overseas investment, joining other global asset managers in attempting to capitalise on Chinese investor demand for foreign assets. According to a notice from the regulator, Blackstone registered a fund management unit with the Asset Management Association of China under the qualified domestic limited partnership (QDLP) programme.

According to the notice, the unit, which was established in March, has seven full-time employees, including five fund professionals.

The quota-based QDLP programme, which was introduced in 2012, allows foreign and domestic fund managers to raise funds from Chinese high-net-worth individuals and institutions, which are then invested in offshore funds.

When the yuan is weaker, the QDLP programme is more popular. In recent months, Chinese investors have rushed to make dollar deposits and purchase Hong Kong insurance, indicating increased demand for foreign assets as the yuan weakens.

As China continues to open its financial markets to foreigners, an increasing number of global asset managers have established themselves in recent years, with fund behemoths KKR and BlackRock receiving QDLP licences last year.

Thornburg Investment Management (Shanghai) Ltd, based in the United States, was deregistered as a QDLP fund manager last month after failing to launch its first private fund within the required 12-month period.