UBS has entered into a joint venture with the Chinese State Development Investment Corporation to form a fund management company targeting C...

UBS has entered into a joint venture with the Chinese State Development Investment Corporation to form a fund management company targeting China’s burgeoning affluent. The deal, which has yet to be approved by China’s securities regulator, will give UBS a 49 per cent stake in China Dragon Fund Management, a Shenzen fund management company owned by the state-controlled SDIC. Terms of the deal were not disclosed. China Dragon manages around $350 million in mutual fund assets. Under the deal with UBS, China Dragon will be used as a platform for new mutual funds. Once regulations permit, they may also push into discretionary investment management and other activities. “China is a key strategic market for all of UBS. This is an important step in our strategy to build a major presence in China's asset management industry as market liberalisation continues,” said John Fraser, head of UBS's asset management activities.