Citing unnamed "people familiar with the matter," The Financial Times reported Saturday that such American firms as Blackstone and the private equity arm of Goldman Sachs are setting up renminbi-based funds for investment in local companies, which may also signal that China is willing to upgrade its standards of corporate management.
China has been promoting the use of the renminbi as its concerns mount about the dollar. The newspaper said foreign investments have traditionally been stymied by the lack of deal flow in China, but now Blackstone is reportedly teaming up with the Peoples' Government of Shanghai Pudong New Area, which has a track record of investing in local companies and could benefit from Blackstone's operational expertise.
The Financial Times said a recent report issued by the international legal firm O'Melveny & Myers contends that "foreign investors are increasingly looking at the attractiveness of (China's) domestic deal flow and the desirability of setting up an onshore investment platform and a renminbi fund to facilitate onshore deal-making."
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