March 5 (Bloomberg) -- Pacific Century Premium Developments Ltd., the property unit of billionaire Richard Li’s PCCW Ltd., rose by the most in about three years in Hong Kong after saying it plans to buy back shares at a premium.
The stock resumed trading today, after being suspended on Jan. 31. The shares climbed 28 percent, the biggest intraday increase since April 2009, to HK$1.81 as of 2:51 p.m. trading break. The Hong Kong-based company plans to repurchase as much as 38 percent of its shares at HK$1.85, 35 percent more than the close on Jan. 30, Pacific Century said in a statement.
Pacific Century, 62 percent held by PCCW and 23 percent by Elliott Capital Advisors, L.P., plans to restore the proportion of publicly traded shares with the buyback offer to the limit required by the exchange, according to the statement. The total cost of the repurchase will be HK$1.71 billion ($220 million) and will be paid out of the company’s own resources, it said.
“The liquidity of the shares has been impaired by the concentration in the hands of the Elliott entities,” Hong Kong-based Pacific Century said. This “has partly contributed to the limited investor interest in the shares.”
Pacific Century said it plans to offer as many as four bonus shares for each existing share held after the buyback is completed, and may take other steps to insure the restoration of the 25 percent public holding. Shareholders will have the option of accepting convertible notes instead of new shares.
Hong Kong’s benchmark Hang Seng Index fell 1.3 percent as of 2:51 p.m..
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