Private equity groups unable to sell or list China-based portfolio companies

Good morning and welcome back to the last FirstFT before we take a brief Christmas Day break. Here’s what’s on the agenda today:

---

The world’s top private equity firms have found themselves trapped in China, unable to sell or list their China-based portfolio companies this year, as Beijing has cracked down on initial public offerings and the economy slows.

Among the 10 largest global private equity groups with operations in China, there is no record of any having listed a Chinese company this year or fully sold their stake through an M&A deal, figures from Dealogic show.

It is the first year for at least a decade where this has been the case, though the pace of exits has been slow since Beijing introduced restrictions on Chinese companies’ ability to list in 2021.

Goldman Sachs chief executive David Solomon said at a Hong Kong conference in November that one of the reasons investors were “predominantly on the sidelines” over deploying funds in China was that “it’s been very difficult . . . to get capital out”. Read the full report.

Five more top stories

1. A Russian cargo vessel operated by the defence ministry’s logistics fleet sank today in international waters between Spain and Algeria while en route from St Petersburg to Vladivostok. The ship, called Ursa Major, sank following an explosion in its engine room. Two crew members remain missing, while 14 others were rescued and taken to the Spanish port of Cartagena, Russia’s foreign ministry said.

2. France’s new prime minister François Bayrou has selected Eric Lombard, head of state-backed financial group Caisse des Dépôts, as finance minister, entrusting him with devising a budget that can pass the country’s raucous hung parliament. The appointment came after days of wrangling between Bayrou and President Emmanuel Macron. Here are the other officials in the new cabinet.

3. The EU is emptying its gas storage facilities at the fastest pace since the energy crisis three years ago as colder weather and a decline in seaborne imports raise demand. The volume of gas in the bloc’s storage sites has dropped 19 per cent from the end of September, when the refilling season ends in gas markets, to mid-December, according to an industry body. Read the full report.

4. Joe Biden has stamped his legacy on the federal bench after Senate Democrats raced to confirm more than 200 nominees to lifetime appointments in courts across the US, outpacing Donald Trump’s tally during his first presidency. Read more about the full list.

5. Airlines on both sides of the Atlantic are braced for their busiest Christmas season. In the UK, carriers will fly 6.1mn seats between December 20 and January 2, a 5 per cent increase on the previous record set in 2019, according to aviation data, while a record 54mn passengers are forecast to fly on US carriers between December 19 and January 6. Here are the top destinations.

The Big Read

The world’s biggest online dating companies are in crisis as women and younger users increasingly look towards niche apps and real-life meets — or even opt out of romantic relationships altogether. Why have users fallen out of love with dating apps?

We’re also reading . . . 

• ‘Waste of time’: The FT spoke to ministers, business leaders and Labour MPs to piece together what went wrong for UK Prime Minister Sir Keir Starmer after his landslide election victory.

• Dispatch from Syria’s Latakia: In the Assad dynasty’s home province and one-time stronghold, many fear the regime change marks the start of a cycle of disempowerment and retribution.

• Dax bull run: Germany’s own “magnificent seven” have driven a strong rally in the country’s stock market this year, defying the gloom enveloping the domestic economy.

• Misinformation: A Russian online ad agency with a London affiliate has been implicated in influence campaigns in France, Germany and Romania.

Chart of the day

Three more EU member states — including the most populous, Germany — have joined the list of countries with “ultra-low” fertility rates, highlighting the extent of the region’s demographic challenges. Birth rates have fallen even in countries where family-friendly policies had previously helped boost the number of babies.

Take a break from the news

In our society, momentous news tends to be shared first with those in significant or high-profile positions, as it has been throughout history. So it is notable, writes Enuma Okoro, that a group of “lowly” shepherds was deemed important enough to receive the news of the birth of Jesus. The humble characters of the Nativity story have much to teach us about being open to ideas of spirituality.

Additional reporting by Irwin Cruz and Emily Goldberg

FirstFT will be taking a break tomorrow but we’ll be back in your inboxes on Thursday. Thank you for reading, and happy holidays!