The Chinese market will soon witness the first joint venture firm where a foreign company will take an absolute controlling stake as part of the deeper opening up of the country's financial sector.

According to information from the Shanghai United Asset and Equity Exchange, Shanghai Trust Co Ltd announced on Monday the transfer of its 2 percent stake in CIFM, its joint venture with JPMorgan Asset Management. The transfer price is 241.3 million yuan ($35.1 million).

CIFM was founded in May 2004 with Shanghai Trust holding a 67 percent stake and JPMorgan with a 33 percent share. In August 2015, the stakes of the two companies were adjusted to 51 percent and 49 percent respectively in the joint venture.

Once the stock right transfer is finalized, JPMorgan Asset Management will become the controlling stake holder of the fund company.

Shanghai Trust said the stock transfer is in response to the call for China to further open up the financial sector and it also addresses the group's strategic development goals.

By the end of last year, CIFM managed assets worth 160 billion yuan. CIFM saw its turnover reach 434.4 million yuan and net profit hit 121.5 million yuan at the end of May 2019.The fund company's net profit stood at 336 million yuan in 2018 and 335 million yuan in 2017.

In April 2018, the China Securities Regulatory Commission for the first time allowed a foreign company to hold the controlling stake in a Chinese fund company.

Public data showed there are 45 joint venture fund companies in China. About 20 of these fund companies have foreign investors holding a 49 percent stake, while another 10 joint ventures have foreign investors with a 30 percent stake in those companies.

A report jointly released by investment bank Morgan Stanley and consulting firm Oliver Wyman predicted the size of the Chinese public fund sector will surge to $7.5 trillion by 2025, quadruple the number registered in 2018.

The huge potential of the Chinese market is extremely attractive for international asset management companies which face pressure in their domestic markets, the report said. With this in mind, leading international asset management and fund companies have accelerated their attempts to get into China.

In late April, the world's top asset management company BlackRock appointed Tang Xiaodong as its China head. Tang used to be the deputy general manager of Guangzhou-based GF Securities.

BlackRock Chief Executive Officer Laurence Fink stressed at Tang's appointment that China is a strategic priority for the company and it plans to remain very engaged in pursuing its long-term strategy in this key market. BlackRock has $6.5 trillion in assets under management worldwide.

Industry insiders said that Black-Rock is negotiating with China International Capital Corporation Limited to acquire a majority stake in the latter's affiliated public fund company.