One of Asia’s longest running shareholder battles is coming to an end.
Dong a Bank Ltd.
A Hong Kong-based lender, on Friday said it planned to pay the equivalent of about $373 million to buy all the shares held by U.S. activist hedge fund Elliott Management Corp. held in an off-market transaction.
Elliott has withdrawn from Hong Kong and has not been authorized by the Securities and Futures Commission of Hong Kong since late last year. The company declined to comment on the transaction and its presence in the Asian financial hub.
The deal, if completed, would end years of tug-of-war between the two sides. It also followed a slide in the share price of Dong A Bank.
Elliott, founded by American billionaire Paul Singer, started buying back shares of the bank in 2010, and call it for sale in 2016.
Since then, relations between Bank of East Asia and Elliott have soured, with the bank refusing to sell but moving to sell off some assets. East Asia Bank, founded in 1918, was the last major family-backed lender in Hong Kong, after many smaller rivals were snatched up by buyers such as mainland Chinese companies. the years.
In March 2020, the two sides reached an armistice, and DongA Bank have agreed to conduct a strategic review to help assess whether the bank can sell assets or improve its business. The review ultimately resulted in the Hong Kong bank agreeing to sell its insurance business in 2021 to
AIA Corporation Ltd.
On Friday, Dong A Bank said it plans to use its cash to buy back an 8.43% stake held by Elliott, currently the bank’s fourth-largest shareholder. According to stock exchange filings, the transaction requires the approval of at least three-quarters of the bank’s independent shareholders, excluding Elliott.
Adrian Li and Brian Li, co-CEOs at Bank of East Asia, said: “This is an efficient use of capital and a clear testament to our confidence in the bank and its strategies. business that we are actively doing”.
When the deal is completed, DongA Bank will cancel all the shares it has bought back, increasing the holding ratio of all other existing shareholders. Japan’s Sumitomo Mitsui Banking Group, currently the Hong Kong bank’s largest shareholder, will see its holdings increase from 19.66% to 21.47%.
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Appeared on January 29, 2022, print edition as ‘Elliott sells stake in Asian bank.’
https://www.wsj.com/articles/elliott-management-to-sell-stake-in-hong-kong-bank-ending-activist-campaign-11643384538?mod=rss_markets_main Elliott Management to Sell Shares in Bank of Hong Kong, End of Activist Campaign