Eurizon Financial Group, an Italy-based consortium, has signed an agreement to acquire a 49 percent stake in Penghua Fund Management.

"We inked a deal several weeks ago and have received the green light from the Italian regulator," said Mario Greco, CEO of Eurizon Financial Group, yesterday.

But he declined to reveal the value of the deal as it is still subject to approval by the China Securities Regulatory Commission.

Set up in 1998, Penghua is one of the leading fund management companies in China. The fund increased its registered capital from 80 million yuan to 150 million yuan in 2001 and now manages four closed-end, seven open-end and four pension funds.

Its shareholders include Guosen Securities, Founder Securities, Anhui Guoyuan Trust and Investment Co, and Beirongxin Investment Co.

"Penghua's market positioning, its investment portfolio and potential for further development of the distribution platform are the major attractions for us," said Greco.

Eurizon Financial Group, with 192 billion euros in its kitty, has a strong background in life insurance, pension and asset management businesses.

"We've spent a year and a half doing market investigation and finally set our sights on Penghua and Union Life," Chiara Magistris, head of strategic projects (Greater China), told China Daily.

Earlier this month, Eurizon bought a 19.9 percent stake in Union Life Insurance for 800 million euros.

Although Eurizon is a subsidiary of Intesa Sanpaolo, the third-largest bank in Europe, it doesn't plan to enter China's banking sector in the short term.

"We would like to focus on the two investments with Penghua and Union Life for the time being, and we don't plan to buy stakes in other fund management companies and insurers," Greco said.

Eurizon also plans to set up a representative office in Beijing as soon as possible.

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