HSBC gets nod to sell stake in Ping An
Source: Agencies |
February 2, 2013, Saturday
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Print Edition
Print Edition
CHINA has approved the sale of HSBC's remaining US$7.5 billion stake in Ping An Insurance to a group controlled by Thailand's richest man, giving the green light to the country's biggest inbound merger and acquisition deal.
For HSBC Holdings Plc, the sale marks its departure from a decade-long interest in China's second-biggest insurer and books it a US$2.6 billion post-tax gain from selling what it no longer sees a core asset.
Approval by the China Insurance Regulatory Commission had been in doubt after media reports last month raised questions over the Thai group's funding for the deal.
Charoen Pokphand Group, controlled by billionaire Dhanin Chearavanont, bought HSBC's 15.6 percent stake in Ping An in December for US$9.4 billion, agreeing to pay up front for around a fifth of that stake last month, and the rest, backed by China Development Bank, on approval by the Chinese regulator.
The first payment was supposed to be funded by CP Group's wholly-owned subsidiaries, but local media reports said people not directly tied to the Thai food conglomerate were behind the transaction, prompting CDB to voice its concerns. The bank would likely not want to be involved in facilitating a non-Chinese mainland investment in local stocks.
The transfer of the second tranche of shares to CP Group will be completed on next Wednesday, HSBC said in a filing yesterday.
The Ping An deal was Asia's second-biggest acquisition last year, behind Chinese oil firm CNOOC Ltd's planned US$15.1 billion purchase of Canada's Nexen Inc.
For HSBC Holdings Plc, the sale marks its departure from a decade-long interest in China's second-biggest insurer and books it a US$2.6 billion post-tax gain from selling what it no longer sees a core asset.
Approval by the China Insurance Regulatory Commission had been in doubt after media reports last month raised questions over the Thai group's funding for the deal.
Charoen Pokphand Group, controlled by billionaire Dhanin Chearavanont, bought HSBC's 15.6 percent stake in Ping An in December for US$9.4 billion, agreeing to pay up front for around a fifth of that stake last month, and the rest, backed by China Development Bank, on approval by the Chinese regulator.
The first payment was supposed to be funded by CP Group's wholly-owned subsidiaries, but local media reports said people not directly tied to the Thai food conglomerate were behind the transaction, prompting CDB to voice its concerns. The bank would likely not want to be involved in facilitating a non-Chinese mainland investment in local stocks.
The transfer of the second tranche of shares to CP Group will be completed on next Wednesday, HSBC said in a filing yesterday.
The Ping An deal was Asia's second-biggest acquisition last year, behind Chinese oil firm CNOOC Ltd's planned US$15.1 billion purchase of Canada's Nexen Inc.
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