Diving into a booming market,
The move is seen as an attempt by Principal to entrench itself into a red-hot Hong Kong equity market that has grown more than 60% since April, and begin laying the groundwork for an Asian invasion. Guoco had owned DHFM since 1981.
DHFMs pension fund management business, led by the Mandatory Provident Fund, is seen as its greatest value, although it is also involved in other institutional investments and mutual funds.
"This transaction is an extraordinary opportunity for The Principal to secure its position as one of the key players in Hong Kong's fast growing retirement market," said Norman Sorensen, president of Principal International.
Guoco said that Principal is the right company to advance DHFMs dependability and long-term success. Principal is in the process of setting up a mutual fund base in China, although it has not yet officially arranged which banks or securities firms would sell its products there.
