AsianFin -- China International Capital Corp (CICC) is poised to merge with China Galaxy Securities, according to Reuters, citing five sources familiar with the matter. The deal would create the country’s third-largest brokerage, with total assets amounting to $193 billion.
The merger between CICC and Galaxy Securities, marking the second major consolidation in China’s $1.6 trillion securities industry within a few months, has gained approval from Chinese regulators and could be announced in the coming weeks, the sources said.
Both firms, which are primarily owned by the state-backed China Investment Corporation (CIC), are expected to merge through a share swap, though specific financial details were not disclosed.
Once completed, the combined company would surpass Huatai Securities to become China’s third-largest brokerage by assets. The transaction is still subject to regulatory and shareholder approvals, the sources added.
This merger is part of Beijing’s broader push to create larger and more competitive domestic investment banks, aiming to counterbalance global giants like Goldman Sachs and Morgan Stanley, which have increasingly sought to dominate the Chinese market following full control of their local operations.
The newly formed entity is expected to be better positioned to weather the current challenges facing China’s fragmented financial sector, which has been impacted by a slowing economy, weak market conditions, and tighter regulations.
The sources requested anonymity as they were not authorized to speak publicly.
Representatives for CICC and Galaxy Securities did not immediately respond to requests for comment, while CIC declined to comment. The State Council Information Office and the China Securities Regulatory Commission also did not respond to inquiries.
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