HSBC Holdings has announced a proposal to privatise Hang Seng Bank, offering to purchase the subsidiary’s outstanding shares at HK$155 per share in cash, according to a filing to the Hong Kong exchange on Thursday.
The price represents a premium of 30 per cent over the last closing price of HK$119 per share on Wednesday. The shares would be cancelled under the proposal.
HSBC said it believed the proposal, offered by HSBC Asia-Pacific, the Hong Kong incorporated wholly owned subsidiary of HSBC, would strengthen “the Hong Kong banking presence of both HSBC Asia Pacific and Hang Seng Bank, focusing on their relative strengths and competitive advantages, but continuing to allow all customers to choose where to bank”.
HSBC said it intended to continue to invest in people and technology across both HSBC Asia Pacific and Hang Seng Bank and expected there to be an opportunity “to create greater alignment across HSBC and Hang Seng Bank that may result in better operational leverage and efficiencies”.
“Hang Seng Bank has been rooted in Hong Kong for close to 100 years and has a distinctive legacy,” HSBC said in the filing. “HSBC intends to continue to respect the legacy of Hang Seng Bank and to serve Hong Kong through both the HSBC and Hang Seng Bank brands.
