Billion private TPG Nasdaq listing! The founder is known as the legend of Wall Street M&A, and the China market frequently takes shots.

On January 13th, local time, American alternative asset management company TPG was listed on NASDAQ. The company’s share price closed up more than 15% that day, with a total market value of $10.4 billion. As a private equity giant, TPG manages assets of US$ 109 billion (equivalent to nearly RMB 700 billion) and invests in well-known Chinese and foreign companies such as Uber, Burger King and Lenovo.

TPG has been established for nearly 30 years. At the beginning of this century, it was famous for its participation in large-scale mergers and acquisitions. Since the financial crisis caused huge losses, TPG’s focus has gradually shifted to diversified investment, and currently it mainly involves business sectors including private equity and real estate. Company executives revealed that in the future, they will also consider expanding into credit, infrastructure and other fields.

As a private equity giant, TPG is one of the largest alternative asset management companies in the world. The company was founded in 1992 in Fort Worth, Texas and San Francisco, California, formerly known as Texas Pacific Investment Company. In the past 30 years, TPG, headquartered in the above two cities, has developed from a small family startup to a top alternative asset management company, and has investment and operation teams in 16 cities around the world.

According to the prospectus, TPG plans to issue 33.9 million ordinary shares. Based on the issue price of $29.5, TPG can get a net income of about $775.1 million from this IPO. If the underwriter exercises the over-allotment right, the value can reach $825.2 million. TPG issued a price of $29.5 per share, and closed up 15.25% at $34 on the 13th, with a market value of $10.436 billion.

In terms of revenue, in 2018, 2019, 2020 and the first nine months of 2021, TPG’s total revenue was $1.404 billion, $1.988 billion, $2.115 billion and $3.897 billion respectively, and its net profit was $711 million, $1.18 billion, $1.439 billion and $3.822 billion respectively.

According to public information, the assets managed by TPG reach 109 billion US dollars, and there are several investment platforms such as TPG Capital, TPG Asia Capital, TPG Growth Fund and TPG Impact Investment Fund. TPG mainly invests in business sectors including private equity (Capital), Growth, Impact, Real Estate and Market Solutions. At present, the company has invested in more than 280 enterprises, including Continental Airlines, Uber, Airbnb, Burger King, Xiaoman Finance, Dangdang Express Medicine and other companies.

In this share offering, JPMorgan Chase Securities Company, Goldman Sachs Group Corporation, Morgan Stanley Company and TPG Capital BD will serve as the co-lead book managers of this offering. Bank of America Securities, Citigroup, Deutsche Bank Securities, Evercore ISI, UBS Investment Bank, Wells Fargo Securities, BMO Capital Markets and Barclays Bank acted as joint book managers.

Compared with the main competitors KKR and Blackstone, TPG is relatively small, and the road to listing is more than 10 years late.

In the first decade of the 21st century, TPG encountered difficulties because of poor investment. During the financial crisis that began in 2008, TPG lost $1.4 billion due to its $7 billion investment in Washington Mutual Bank. As the largest savings bank in the United States,be mutually beneficialThe bank was taken over because it could not bear the heavy mortgage losses.

It is reported that David Bond Mann is one of the founders of TPG, known as the merger legend of Wall Street. In the second year of TPG’s establishment, the company, together with Air Canada and Air Partners, injected US$ 450 million to acquire Continental Airlines, which was in bankruptcy dilemma, to help the latter become a leading airline in the world. This is the first important investment in TPG operation. Before the financial crisis, in 2006, TPG participated in M&A transactions with a total value of nearly 100 billion US dollars, which exceeded the global transaction value of Blackstone and KKR at that time.

Some analysts pointed out that after the financial crisis, TPG focused on diversified investment. Especially after Jon Winkleid (current CEO) joined, the company’s business grew rapidly. Compared with 2016, the company’s current asset management scale has nearly doubled. Jon, who worked for Goldman Sachs for 27 years, said TPG would consider expanding in credit and infrastructure.

In July 2021, the Climate Fund under TPG Rise Fund announced the completion of the first round of fundraising, with a scale of US$ 5.4 billion, which will invest in global enterprises and solutions to address climate change. TPG Shangshan Ruisi Climate Fund was established in early 2021, with former US Treasury Secretary Henry Merritt Paulson as its executive chairman. Paulson was also an important figure behind the 2008 financial crisis, and served as the chairman and CEO of Goldman Sachs Group, a large investment bank.

TPG also has close ties with China. The history of the company’s layout in China can be traced back to 1994. At that time, TPG opened its first China office in Shanghai, becoming one of the first global private equity investment institutions to enter China. According to the company’s website, over the past years, TPG has made pioneering investments in many companies in different fields in China, including financial services, medical and health care, consumer retail, technology, media and information services, and social impact investment.

The Securities Times reporter found that well-known companies such as United Family Medical, Lenovo, CICC, Li Ning and China Postal Savings Bank all have the investment trajectory of TPG. In early 2019, TPG signed a cooperation agreement with CICC Capital to establish a "China Synergy" platform. The platform adopts the dual currency structure of USD/RMB. With the cross-border investment and business capabilities of both parties, it will seek and seize investment opportunities related to China on a global scale. The two sides invested core resources and sent a joint working team to jointly set up the professional investment platform.

In recent years, TPG has made frequent efforts in the field of medical and health care, and its investment enterprises include Zhaoke Ophthalmology, Dangdang Express Medicine and so on. In June last year, the Internet "medical+medicine" health home service platform Dangdang Kuaiyao announced that it had obtained a new round of financing with a scale of 220 million US dollars. This round was led by TPG Asia Fund. OrbiMed and Redview Capital jointly led the investment, followed by Vallian, Lanxin Asia, Xia Yan Capital and Yingke Capital. CICC, CMB International and Huaxing Capital acted as financial advisers.

At present, the chairman of TPG Group in China is Sun Qiang. Before joining TPG, he founded Black Land Group and served as the chairman. According to his resume, after graduating from Beijing Foreign Studies University, Sun Qiang went to the Lauder Institute of Wharton Business School for further study, and obtained a master’s degree in business administration and international studies. From 1995 to 2015, Sun Qiang served as a partner of Warburg Pincus Investment Group, a member of the Global Management Committee and the chairman of the Asia-Pacific region. Sun Qiang also served as the executive director of the investment banking department of Goldman Sachs Group, the investment manager of Lebok Company, and the full-time translator of the United Nations Headquarters.

It is worth noting that TPG is also one of the first companies to participate in private equity investment in Asia. As the main investment platform of TPG in China, TPG Asia Capital is the first private equity investment institution to invest in Asia, and has also been deeply involved in India, Southeast Asia, Japan, South Korea and Australia.