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Capital Markets

Goldman’s patience pays off as it readies to buy 100% of China JV

Goldman Sachs has been waiting 16 years for the right to run a wholly owned business in China. It is now a big step closer to realizing the dream.

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Goldman Sachs and China have a lot in common. Both march to their own tune and are accustomed to getting their own way. Both are patient; but neither likes to be kept waiting.

That thought came to mind when the US investment bank said on December 8 that it was moving to acquire a 100% stake in its mainland China securities joint venture, Goldman Sachs Gao Hua (GSGH).

The details of the deal are simple enough.

Goldman will buy the 49% stake it does not already own in the JV it set up in 2004 with Beijing Gao Hua Securities, a domestic brokerage founded by erstwhile investment banking rainmaker Fang Fenglei and investment firm Legend Holdings.

All the New York bank’s onshore operations, including non-investment banking services such as wealth management and securities trading, will then migrate to a new wholly owned entity, to be called Goldman Sachs (China) Securities.

Green light

The deal is not complete: Goldman likely will not receive a green light to buy out its long-time mainland partner until some time in 2021.

But at this point in time, it looks pretty much signed and sealed.

“The

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