Three Reasons why ICBC Chose Goldman Sachs Consortium
The Industrial and Commercial Bank of China (ICBC) was listed last month in Hong Kong and Shanghai.
Instead of picking another bank to partner up with, ICBC chose a consortium led by Goldman Sachs, including Allianz Group and American Express Co.
The consortium bought 8.89% of ICBC shares making their investment the largest single foreign investment in China’s financial sector.
A senior executive gave three reasons for the decision to work with Goldman Sachs:
1. First, these investors will not compete with ICBC in their main area of business.
2. Second, these investors are familiar with the management of commercial banks.
3. Third, these foreign investors have large research teams.
A more complete explanation of ICBC’s reasoning can be found here.
It makes sense to me and shows real maturity on ICBC’s part that they have taken a non-traditional approach.
Time will tell if they made the right decision or not.
What do you think?
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