After a 13-year career with Goldman Sachs, Fred Hu will retire as a partner of the firm and become an advisory director in April. Sources say he plans to launch a private equity fund.
Hu is chairman of Greater China, responsible for the firm's China strategy and investment banking. He was recently appointed to the firm's newly created IBS (investment banking services) leadership group, designed to assume coverage of a series of the firm's most important franchise accounts, across industries and regions, in an effort to strengthen its footprint of trusted advisory relationships.
A spokesperson for the bank said that Hu won't be replaced as other bankers will pick up his coverage.
Hu joined Goldman Sachs as chief economist for Greater China in 1997. In 2002 he moved to the executive office to develop the firm's China business strategy and to help establish its onshore presence in China. The following year, he became co-head of China investment banking. He was named chairman of Greater China in 2008 and served on a number of the firm's leadership committees, including the partnership committee. He was named managing director in 2000 and partner in 2004.
An internal memo seen by FinanceAsia stated: "Fred has played a significant leadership role in the development of our China franchise and the Asia region and led some of the firm's landmark transactions in financing, advisory and principal investments. His creativity, drive and commitment to excellence have been an inspiration to those who have worked with him over the years. In addition to his commercial impact, Fred has been instrumental in hiring, developing and mentoring many of our professionals."
Some sources say that an investment arm of China Construction Bank and Temasek will both help Hu launch a new China-dedicated fund. Others say that Goldman Sachs is also helping in the launch, but the firm declined to comment. One insider at Goldman was sceptical of this information, though, noting that there are several rumours circulating about what he plans to do, including one that says he's been approached to work in a government role. Hu could not be reached for comment.
If he does set up a fund, it would not be the first time a Goldman alum has established a new fund in China. Fang Fenglei, who helped Goldman launch its investment banking joint venture in China -- Goldman Sachs Gaohua Securities -- set up Hopu Investment Management in 2007. That Beijing-based $2 billion private equity fund, with a mandate to invest in the mainland, also boasts Temasek and Goldman as key investors.
And in 2008, private equity firm CVC Capital Partners opened a Beijing office and appointed Zhu Wei to run it. Zhu Wei had been a managing director at Goldman Sachs Gao Hua Securities and headed the investment banking coverage in Shanghai.