Haixia Seeks Up to $881 Million Selling Its Haitong StakeFox Hu
Haixia Capital Management Co., a Chinese state-backed investment firm, is seeking as much as $881 million selling its entire stake in Haitong Securities Co. at a discount of as much as 20 percent.
A fund managed by Haixia Capital is offering 569.4 million shares of the Chinese brokerage at HK$11.12 to HK$12 each, according terms for the deal obtained by Bloomberg. The price range represents a 13.7 percent to 20 percent discount to Haitong’s last close in Hong Kong.
Haixia Capital is offloading its stake at a loss after a 45 percent plunge in Haitong’s Hong Kong-traded shares over the past month. A flurry of measures to stabilize the Chinese stock market, including a pledge by state-run financial firms to buy 120 billion yuan ($19.3 billion) of shares and a halt to initial public offerings, is failing to stop a rout that erased more than $3.2 trillion of value.
The fund manager, backed by government-owned State Development & Investment Corp., bought the Haitong shares earlier this year at HK$17.18 each, as part of a $4.2 billion stock sale completed in May, Hong Kong exchange filings show.
Haitong fell 13 percent to close at HK$13.90 in Hong Kong trading on Tuesday. UBS Group AG is sole bookrunner for Haixia’s disposal.
China’s A shares continued to slump on Tuesday as measures to stabilize the market failed to stop a rout that’s erased more than $3.2 trillion in market value. Chinese shares traded in Hong Kong entered a bear market on Tuesday.
The MSCI Emerging Markets Index has fallen about 2.9 percent this year. The MSCI World Index has gained 0.8 percent in 2015.
To continue reading this article you must be a Bloomberg Professional Service Subscriber.
If you believe that you may have received this message in error please let us know.