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Saudi PIF to invest $500m in Hong Kong Chaoshang

By Pramod Kumar
PIF's investment includes $100 million in five-year convertible debentures and $400 million in a five-year loan Reuters/Florence Lo
PIF's investment includes $100 million in five-year convertible debentures and $400 million in a five-year loan

The Public Investment Fund (PIF), Saudi Arabia’s sovereign wealth fund, has signed an agreement to invest $500 million in Hong Kong Chaoshang Group, an investment holding company.

The investment includes $100 million in five-year convertible debentures and $400 million in a five-year loan.

Negotiations on the terms of the investment will be completed within three months, the Hong Kong-listed company said in a statement. However, the agreement is not legally binding.

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The PIF funding will boost the company’s liquidity and increase investments in mining, healthcare and other sectors.

Hong Kong ChaoShang Group Limited saw its operating loss increase for the fiscal year ended March 31, 2024, with losses rising from HK$42 million ($5 million) in 2023 to HK$87,563,000.

In November 2023, PIF was reported to be in discussions about a $250 million investment in the Chinese electric vehicle maker Human Horizons Group.

A month later, the wealth fund was also said to have increased its investment to $200 million in a technology venture backed by China’s Alibaba Group.

Last year, a new exchange-traded fund (ETF) tracking Saudi equities was listed in Hong Kong, becoming the first product of its kind in Asia.

In May this year it was revealed that officials in Hong Kong were planning to set up an ETF with Saudi Arabia’s stock exchange.

Michael Wong, Hong Kong’s deputy financial secretary, speaking at the inaugural international Capital Markets Forum in Hong Kong, said formal negotiations were under way for an investment promotion and protection agreement with Saudi Arabia.

Wong said that the Hong Kong government was also considering establishing an economic and trade office in Riyadh.

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