Two listed companies under China Resources Group are planning to redomicile from the Cayman Islands to Hong Kong, marking the first batch of listed companies to reincorporate in the city under a new law, with analysts believing the trend will continue.
China Resources Beverage (Holdings), the country’s second-largest water bottler under the brand C’estbon, has proposed to redomicile from the Cayman Islands to Hong Kong to reduce operating costs, according to a stock exchange filing late Friday night.
Its sister company, China Resources Building Materials Technology Holdings, announced the same move on Friday night. Both firms said they would need approval from the Hong Kong Company Registry and Cayman Islands regulators, as well as their shareholders. The change would not affect their business operations or listing status.
The move to set up in Hong Kong would reduce compliance costs as they now need to follow two sets of regulations – those of Hong Kong and the Cayman Islands – and they would also like to use the city to expand their international business, the companies said.
“The change of domicile is an important initiative for the company to further establish its presence in Hong Kong, which can enhance local and international investors’ confidence in the company and facilitate communication between the company and the investors,” Zhang Weitong, chairman of China Resources Beverage, said in the filing.
Both firms are part of state-owned China Resources Group, which is headquartered in Hong Kong and has a wide range of businesses, including consumer goods, energy, urban construction and healthcare. The group has nine listed companies in Hong Kong and 13 on the A-share market in mainland China.
