Hong Kong SFC: China Life Proposed Buying 10% Of Wing Hang Bank
February 24 2009 - 10:26PM
Dow Jones News
China Life Insurance Co. (LFC) proposed buying a 10% stake in
Wing Hang Bank Ltd. (0302.HK) from a Bank of New York unit last
year, but the Hong Kong securities regulator ruled the deal would
trigger a buyout offer from the family that controls the bank.
The deal didn't proceed following the ruling from the Securities
and Futures Commission and it is unclear whether any talks on such
an acquisition are still pending. Wing Hang and China Life both
declined comment Wednesday morning.
At 0250 GMT, Wing Hang's shares were up 11% at HK$44.40,
outperforming the benchmark Hang Seng Index's 2.2% rise.
BNY International Financing Corp. holds 20.28% of Wing Hang
Bank, and China Life had proposed buying 10% from the BNY unit, the
SFC said in a statement issued late Tuesday. At the same time, Hong
Kong's Fung family, the largest shareholder in Wing Hang, had
proposed buying 5% from the BNY unit, raising the family's stake to
28.58%, the SFC said.
Since the Fung family and BNY had a relationship going back 30
years, the SFC ruled that they and China Life would be acting
together on the transaction. Since the combined stake would exceed
30%, the Fung family would have to make a general offer for the
company.
The SFC said it had held off announcing its ruling at the
request of the parties involved, who cited commercial
sensitivities.
The SFC statement didn't mention a price of the transaction. But
it said the offers were made in May and July, when the bank's
shares typically were priced at more than HK$100.
-By Jackie Cheung, Dow Jones Newswires; 852-2802-7002;
jackie.cheung@dowjones.com