KUALA LUMPUR (Jan 28): CVC Capital Partners' purchase of a 68.35% stake in Affin Hwang Asset Management Bhd (Affin Hwang AM) for RM1.54 billion is the private equity fund’s sixth investment in Malaysia since 2007, bringing its total capital invested to over US$1 billion.
Senior managing director at CVC Alvin Lim said the firm remains confident in Malaysia’s economic fundamentals. Lim believes the investment is an opportunity for CVC Capital Partners to participate in the development of the domestic asset management industry and capital markets, as well as to grow Malaysia into the region’s leading asset management hub.
“We are particularly excited to partner with Affin Hwang AM’s talented management team, who has shown a track record of outperformance, and Nikko Asset Management (Nikko AM), who will remain as a strategic shareholder.
“We look forward to supporting the management team in expanding the investment and product capabilities and entering other ASEAN markets, by leveraging on our experiences and network across the region,” he said in a statement.
CVC’s unit Starlight Asset Sdn Bhd has signed a conditional share purchase agreement with Affin Bank Bhd to take over the controlling stake of Affin Hwang AM. The sale values Affin Hwang AM, whose assets under management amount to RM81 billion, at RM2.25 billion.
The transaction is expected to be completed in the third quarter of 2022, subject to customary closing conditions, including regulatory approvals.
“We are excited to work with CVC, together with our longstanding partner, Nikko AM, to chart the course for Affin Hwang AM’s next phase of growth and to advance the development of the Malaysian capital markets.
“The entry of CVC, a leading global private equity and investment advisory firm, comes at the right time as we continue to broaden our suite of product offerings to cater to the growing needs of our clients and partners.
“We remain deeply committed to helping our clients build their wealth, and we look forward to partnering with CVC and Nikko AM to drive our commitment to our valued clients,” said Affin Hwang AM managing director Datuk Teng Chee Wai.
Affin Bank president and group chief executive officer Datuk Wan Razly Abdullah said the bank is pleased to see the entry of CVC, a global private equity player, into a home-grown asset management house, which is a testament to the confidence in the growth prospects of the financial services sector and the Malaysian economy as a whole.
“With the continuation of the management of Affin Hwang AM helmed by Teng and the institutional shareholding presence of Nikko AM, we believe that the business of Affin Hwang AM will continue to perform well moving forward.
“[We also] are confident that CVC, Affin Hwang AM's management and together with Nikko AM are committed to support Affin Hwang AM’s growth, its superior long-term commitment to deliver value to clients and further develop its talented employees,” he said.
Meanwhile, Nikko Asset Management Asia Ltd president and Nikko AM Asia-ex Japan head Eleanor Seet said the firm's commitment to the region and its clients in Malaysia remains steadfast.
"We are delighted to continue our long-term partnership with the [Affin Hwang AM] management team and welcome CVC. We believe the synergy of the new partnership will continue to strengthen the growth trajectory of Affin Hwang AM and enhance our ability to deliver progressive solutions to valued clients,” she said.