Haitong makes history by buying HK's Taifook Securities
By Wang Yanlin |
November 24, 2009, Tuesday
|
Print Edition
Print Edition
HAITONG Securities Co became the first Chinese mainland brokerage to take over an overseas broker by purchasing Hong Kong-based Taifook Securities Co.
Haitong, China's second-largest broker by market value, bought 52.86 percent of Taifook, Hong Kong's second-largest publicly traded brokerage, according to a filing to the Shanghai Stock Exchange yesterday.
Haitong paid HK$4.88 (62.90 US cents) for each Taifook share, which valued the Hong Kong firm's stock 2.3 percent more than its trading price last Friday, in a deal worth HK$1.82 billion.
"It is an important step in Haitong's strategy of going global," the filing said.
Dai Ming, an analyst at Kingsun Investment Management Co, said the investment was a good bargain.
"The price is reasonable, and Taifook is an ideal platform for Haitong to expand its business scope and reach out to the overseas markets," Dai said.
Shares of Taifook soared 36 percent last week, after its parent company NWS Holdings Ltd said on November 11 that it might sell its majority stake in the brokerage. Taifook's shares have surged 298 percent so far this year on an annual basis and pushed the company's market value to HK$3.43 billion.
Taifook's net profit fell to HK$77 million in the first half of the year due to the global financial crisis. It made HK$112 million in the same period last year and HK$484 million a year earlier.
Shanghai-based Haitong's net profit surged 74 percent in the third quarter on robust trading in the mainland stock market. Taifook, established in 1973, has more than 120,000 retail and institutional investors in Hong Kong and Macau. It has representative offices in Beijing and Shanghai.
Haitong, China's second-largest broker by market value, bought 52.86 percent of Taifook, Hong Kong's second-largest publicly traded brokerage, according to a filing to the Shanghai Stock Exchange yesterday.
Haitong paid HK$4.88 (62.90 US cents) for each Taifook share, which valued the Hong Kong firm's stock 2.3 percent more than its trading price last Friday, in a deal worth HK$1.82 billion.
"It is an important step in Haitong's strategy of going global," the filing said.
Dai Ming, an analyst at Kingsun Investment Management Co, said the investment was a good bargain.
"The price is reasonable, and Taifook is an ideal platform for Haitong to expand its business scope and reach out to the overseas markets," Dai said.
Shares of Taifook soared 36 percent last week, after its parent company NWS Holdings Ltd said on November 11 that it might sell its majority stake in the brokerage. Taifook's shares have surged 298 percent so far this year on an annual basis and pushed the company's market value to HK$3.43 billion.
Taifook's net profit fell to HK$77 million in the first half of the year due to the global financial crisis. It made HK$112 million in the same period last year and HK$484 million a year earlier.
Shanghai-based Haitong's net profit surged 74 percent in the third quarter on robust trading in the mainland stock market. Taifook, established in 1973, has more than 120,000 retail and institutional investors in Hong Kong and Macau. It has representative offices in Beijing and Shanghai.
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