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Updates at 02:25 GMT with share moves, additional information
Investing.com-- HSBC Holdings PLC (LON:HSBA) plans to take its unit Hang Seng Bank (HK:0011) private in a deal valued at HK$106.1 billion ($13.6 billion), the companies said in a joint statement on Thursday.
HSBC’s Asia-Pacific arm has proposed the privatisation via a scheme of arrangement, under which it offered to acquire the remaining 36.5% stake in the Hong Kong-based lender at HK$155 per share in cash.
The offer represents a 30% premium to Hang Seng’s last closing price of HK$119 and would value the bank at HK$290.31 billion at the time of the offer.
Hang Seng shares surged as much as 41% to HK$168, surpassing the offer price, and reaching their highest level since February 2022.
If approved, the plan would see Hang Seng delisted from the Hong Kong Stock Exchange and become a wholly owned subsidiary of HSBC.
The group said the move is aimed at simplifying its Hong Kong operations and boosting efficiency while maintaining Hang Seng’s brand, governance, and local identity.
HSBC said the proposal would be funded entirely from internal resources and is expected to be earnings-accretive, though it would temporarily lower its CET1 capital ratio by about 125 basis points.
Hong Kong-listed HSBC shares slipped over 6% to HK$103.7.
The privatisation is subject to court and shareholder approval and is expected to be completed in the first half of 2026, the companies added.