(Yicai) April 26 -- Shares in Huatai Securities surged today after the Chinese brokerage said that it is selling its majority stake in US turnkey asset manager AssetMark Financial Holdings, which is listed in New York, to US private equity firm GTCR in a deal worth around USD1.8 billion as the firm adjusts its global strategy.

Huatai’s share price [SHA: 601688] closed up 6.9 percent at CNY14.24 (USD2). AssetMark’s [NYSE: AMK] ended the day down 2.8 percent at USD33.89 yesterday.

GTCR has agreed to pay USD2.7 billion to take AssetMark private, which is equivalent to an offer of USD35.25 per share, Nanjing-based Huatai said yesterday. This is a 4 percent premium on yesterday’s closing price.

The sale sees Huatai secure a return of USD796 million on its investment. Huatai took over AssetMark in October 2016 for USD768 million. The asset manager then went public on the New York stock exchange in July 2019 at USD22 per share, diluting Huatai’s holdings to 68.4 percent. The proceeds from the sale will help optimize asset and resource allocation, it said.

Huatai decided to sell the overseas asset after thoroughly considering the competitive landscape of the turnkey asset management platform industry and the company’s international business development needs, it said.

AssetMark, which mainly provides independent investment advisors with investment strategy and portfolio management, client relationship management, asset custody and other services, manages around USD116.9 billion in assets. The Concord, California-based company posted net profit of USD123 million last year on revenue of USD708 million, Huatai said.

Editor: Kim Taylor