Hong Kong's HKJC Sells $1 Billion in U.S. Private Equity Amid Geopolitical Tensions

The Hong Kong Jockey Club is divesting up to $1 billion in private equity stakes held with major firms like Blackstone, Warburg Pincus, and Clayton Dubilier & Rice. This move comes as geopolitical tensions and trade concerns lead investors to reconsider their exposure to the US. The Jockey Club is selling $700 million in US assets via the secondary market, with Jefferies Financial Group steering the deal. This divestment is part of a wider shift among Asian investors dialing back on US equities and Treasuries.

The Hong Kong Jockey Club (HKJC), a nonprofit organization founded in 1884, is divesting up to $1 billion in private equity stakes held with major firms like Blackstone Inc., Warburg Pincus, and Clayton Dubilier & Rice. This move comes as geopolitical tensions and trade concerns lead investors to reconsider their exposure to the United States. The HKJC is selling $700 million in US assets via the secondary market, with Jefferies Financial Group steering the deal.

The sales come as other Asia funds and wealthy investors dial back investments in the US, concerned that President Donald Trump’s trade wars have made the world’s largest economy much less predictable. According to Bloomberg, about 10 family offices and advisers to the ultra-rich who oversee billions of dollars said they’re reducing their exposure or freezing investments, mostly in US equities and Treasuries [1].

The HKJC’s assets are being sold through different vehicles, with one containing some $700 million of assets. The asset owner initiated the sale process in the first quarter, and some buyers started looking at the deal in April. Jefferies Financial Group Inc is leading the deal, according to people familiar with the matter [2].

This divestment is part of a wider shift among Asian investors dialing back on US equities and Treasuries. The HKJC’s annual customer betting revenue is around HK$43 billion, with the lottery business contributing to its overall revenue of about HK$305 billion ($38.85 billion) [3].

References:
[1] https://www.chinadailyasia.com/hk/article/615552
[2] https://www.marketscreener.com/quote/stock/BLACKSTONE-INC-60951400/news/Hong-Kong-Jockey-Club-Reportedly-to-Unload-1-Billion-in-Blackstone-Warburg-Funds-50470646/
[3] https://www.marketscreener.com/quote/index/S-P-GSCI-COPPER-INDEX-2-46869179/news/Why-Copper-Now-Costs-a-Lot-More-in-the-U-S-Than-2-50471009/