BEIJING — Weijian Shan, chief executive of the Hong Kong fund management firm PAG, says the global economy is dangerous for investors these days. Years of easy money from central banks have helped inflate the prices of just about everything an investor can buy, like stocks or property.
“I think that clearly we are in an asset bubble,” Mr. Shan said in a phone interview from Hong Kong.
So what should investors do? Mr. Shan recommended a return to the basics. His firm, with $16 billion under management in funds that specialize in fields like private equity and real estate, is looking for value in areas still growing in a sluggish world economy.
“We are not chasing bubbles as many of our peers do,” said Mr. Shan, a former professor at the Wharton School of the University of Pennsylvania in Philadelphia. “I only want to look at the fundamentals. I want to know how much money this business makes.”
In that, Mr. Shan is positioned well. PAG focuses mainly on investments in or related to Asia, where the fortunes of China, India and other countries remain buoyant even as the global economy sags.
“If you look around the world, Asia is where the growth is,” he said.
Mr. Shan said that China, where he was born, “is the most interesting market because of its growth.”
But that growth has declined. In the third quarter, China’s gross domestic product rose 6.7 percent, in contrast with the 9 percent to 10 percent the country enjoyed for years. The downturn has intensified the struggles of what Mr. Shan called China’s “bad economy” — mainly manufacturing and heavy industries, which have too many factories and too much debt.
Mr. Shan, however, also sees a “good economy” in China. As the government tries to shift the country’s engine of growth away from investing in steel mills and apartment blocks, it is encouraging more private consumption. That is opening opportunities in areas that cater to Chinese consumers.
“China has a split personality at this moment,” Mr. Shan said. But “the good economy remains quite resilient in spite of the bad economy.”
Mr. Shan, who once served as a senior partner at the investment firm TPG, is focusing his money on companies that can benefit from China’s rising consumerism. In October, PAG’s private-equity arm invested an undisclosed amount in the Paradise Group, based in Singapore, which operates restaurants across China and Southeast Asia.
In August, it spent about $250 million to acquire Golden Apple, which runs a chain of private schools from Chengdu, China’s western metropolis.
In its most prominent deal, PAG in April joined Apex Technology, a Chinese producer of ink cartridge components, and others in the acquisition of the printer maker Lexmark International, based in Kentucky, a transaction valued at $3.6 billion. The deal was appealing to PAG, in part because the new owners hope to raise the profile of Lexmark printers in the Chinese marketplace.
PAG最重要的一笔交易发生在今年4月，公司与中国墨盒组件生产商珠海艾派克科技(Apex Technology)及其他公司一起，收购了总部设在肯塔基州的打印机制造商利盟国际(Lexmark International)，这笔交易的估价为36亿美元。这笔交易对PAG有吸引力，部分原因是公司的新股东希望提高利盟打印机在中国市场的地位。
Mr. Shan also wants to take advantage of some of Asia’s bad economy. With debt levels continuing to rise in China, PAG is developing a strategy for buying and profiting from bad loans at Chinese banks. He also says his firm has generated good returns from buying distressed debt backed by real estate in the region. PAG, which has 30 percent of its capital in real estate, is still sniffing around for reasonably priced property as well.
“We invest in real estate where the price is not out of whack,” he said.
“It is in times like this that you really can differentiate among investors who will be more focused on fundamentals,” he said, “who invests along with the rest of the bandwagon.”