Dagong Global eyes enhanced placement of Dagong Europe
Updated: 2014-12-08 09:31
MILAN - Chinese rating agency Dagong Global has reached an agreement to become the sole shareholder of Dagong Europe, highlighting the significant potential of its European branch to be a key player in the credit rating industry in Europe.
Dagong Global, a leading credit rating agency in China with 600 employees and over 30 branch offices in the country, will acquire the 40 percent shares of Dagong Europe previously owned by Mandarin Capital Partners (MCP), a private equity fund by investors from Europe and China.
The transaction is expected to be closed within the next three months.
"We aim at playing a very important role in the European market. It means that Dagong Europe would need to set up representative offices in different financial centers in Europe and increase the analytical team. That is why we have decided to increase our investment in Dagong Europe," Guan Jianzhong, Chairman of Dagong Global and of Dagong Europe, told Xinhua in a recent interview.
Guan stressed Dagong Europe wants to build up a "bridge" between China, a huge exporter and creditor in the world, and Europe, which is in need of Chinese capital, pumping up mutual investment and undertaking rating responsibility to guard off credit risks.
The chairman emphasized the importance of having a "rating theory," which is at the heart of Dagong Global's rating process.
Dagong Global has developed standards and methodologies in the framework of this "independent and innovative theory," differently from the other rating agencies whose methodologies are not based on a systematic rating theory, he highlighted.
Guan believes the current international rating system must be reformed to represent the common interests of the entire international community.
"Several year after the global financial crisis, we do not see any important change in the international rating agencies, which I think is quite risky," he told Xinhua.
In fact, thanks to its global breath and to its link with the Chinese market, Dagong Europe can bring "more competition and advantage to the rating world, which has been for too many years in the hand of too few players," Lorenzo Stanca, Deputy Chairman at Dagong Europe and Managing Partner at MCP, said.
In his view, various aspects make Dagong Europe relevant and reliable in Europe.
The agency has adopted criteria and methodologies "much more transparent than those of the established players," has put together "an international team of high-profile professionals" and refers to the Chinese market, "which is to become more and more important in the investment decisions," he noted.
"The ability that we are achieving is to be in touch with Chinese investors so that we can represent an entry point to that market," Stanca explained to Xinhua.
"I think we can aim at a European market share between 5 and 10 percent in the next five years," he said, also adding that MCP, co-founder of Dagong Europe, will continue cooperation to help Dagong Europe to thrive.
Ulrich Bierbaum, General Manager of Dagong Europe, commented "I am confident that the new ownership structure will provide even stronger support for Dagong Europe's future growth plans, as we can leverage fully the internationally renowned Dagong brand."
The new structure will further strengthen Dagong Europe's commitment to providing top-notch quality services to European issuers and Chinese investors, Bierbaum pointed out.
Dagong Europe was established in 2012 with the headquarters in the Italian business capital and last year received authorization and registration by the European Securities Market Authority (ESMA) to provide credit opinions on financial institutions including insurance companies and non-financial corporates.
Dagong Global provides credit information services for clients at home and abroad. The Beijing-based agency is the first non-Western credit rating agency that provides the world with sovereign credit risk information.