Tomorrow always knows: How Xiao Jianhua, founder of the low-profile but powerful Beijing-HQ Tomorrow Holdings, came to control RMB1tn

Tomorrow always knows: How Xiao Jianhua came to control RMB1tn

Staff Reporter

2013-04-22

93_1365383799x92y-154717_copy1

Xiao Jianhua, founder of Tomorrow Holdings. (Internet photo)

Xiao Jianhua, founder of the low-profile but powerful Beijing-headquartered Tomorrow Holdings, controls nearly 1 trillion yuan (US$160 billion) of assets ranging from banks to securities houses. His success is founded on his company’s ability to handle rich networks and be sensitive to market information, the Shanghai-based First Financial Daily reports.

The daily said Xiao has been quick to follow every trend in China’s economic reforms, sensing the trend in every new regulation governing securities, banks, insurers and financial leasing companies.

According to New Fortune magazine, Tomorrow Holdings controls nine listing companies holding shares in 30 financial institutions, including 12 city commercial banks, six securities companies, four trust firms, four insurers, two mutual fund companies, one futures firm and one asset management company, with total assets nearing 1 trillion yuan. Yet Tomorrow itself has been almost invisible.Xiao founded his first four companies during 1996-1997 in Beijing, and founded Tomorrow Holdings in 1999. He came under the media spotlight in 2007 when Pacific Securities, part-owned by his Tomorrow group, went public. Financial irregularities were discovered in the listing process and eventually cost a China Securities Regulatory Commission vice-chairman his job. Xiao, however, escaped unscathed.

Not every move has been a success. During 2009-2010, Xiao and his business partners including former vice-president Zeng Qinghong’s son tried to bid for a Taiwanese insurer, Nan Shan Life Insurance. The Taiwan deal didn’t materialize as Taiwan’s regulators could not ascertain who the real buyer was. Xiao’s background and links to senior officials in Beijing also raised eyebrows at the time.

Chinese investors led by Xiao are behind the financing of the first phase of a multi-billion dollar deal between a Thai conglomerate and HSBC Holdings, according to financial news provider Caixin. HSBC announced in December that it would sell its 15.57% stake in Ping An Insurance Group to four companies from Charoen Pokphand Group for a total of US$9.4 billion.

Caixin learned that for a phase of the deal worth HK$15.2 billion, two-thirds of the financing was from mainland Chinese investors led by Xiao. Later both Ping An and Charoen Pokphand clarified that all the funds were from the latter’s four companies.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: