HSBC to take Hang Seng Bank private in surprise bid for efficiency
HSBC Holdings announced a plan to privatise its Hang Seng Bank subsidiary, drawing the curtains on half a century of the unit’s publicly traded status in an unexpected move to simplify its structure amid worsening real estate loans in Hong Kong. The London-based bank would buy all outstanding Hang Seng Bank shares for HK$155 each…
“The benefit of HSBC as a 100 per cent shareholder is it gives Hang Seng Bank even more flexibility to manage its capital and its ratios more efficiently [under] the umbrella of HSBC”, the group’s CEO Georges Elhedery said during a Thursday media round table in Hong Kong. “The [plan] is a long-term strategic investment for growth, which we see as value-accretive for all shareholders in the long term.”
Hang Seng Bank, which traces its establishment to Hang Seng Ngan Ho in 1933, will retain its brand, its branch network, its 11-member board, its license under Hong Kong’s banking ordinance and its “proposition” to customers, Elhedery said.
