Goldman Sachs established a fund using Chinese government money to acquire American and British-based companies, including one engaged in cyber security services for the U.K. government, ‘Financial Times’ reported.
Despite increasing tensions between Beijing and Western nations, Goldman has inked seven transactions through a $2.5 billion private equity “partnership fund” it created with China Investment Corporation (CIC) in 2017, according to numerous individuals who possess firsthand insight into the fund and its operations and who spoke to the FT.
These transactions encompass a range of sectors, including global supply chain tracking, cloud computing, drug testing, manufacturing systems for AI, drones and electric vehicle batteries, according to the FT.
While Goldman Sachs said it had made investments in these companies, it did not explicitly disclose the fund’s contribution to the deals.
Goldman ex-CEO Lloyd Blankfein launched the partnership fund during former President Donald Trump’s 2017 state visit to Beijing. The visit aimed at addressing trade imbalances by channeling Chinese government money into American enterprises.
The fund’s partner, CIC, said it would serve as an “anchor investor” with active involvement in helping to expand the acquired firms in China. CIC is a sovereign wealth fund controlled by Chinese state.
Goldman said in a statement to the FT that “the co-operation fund is a US fund run by a US manager, and is managed to be in compliance with all laws and regulations. The bank added that it “continues to invest in U.S. and global companies, helping them increase their sales into the China market.”