Haitong Securities offers $443 million to take its Hong Kong unit private

(Reuters) -Shanghai-based Haitong Securities is offering up to HK$3.5 billion ($443 million) for all the shares it does not own in its Hong Kong-listed unit, Haitong International Securities, to take it private.

Haitong Securities currently owns 73.4% of the investment banking arm.

It will offer HK$1.52 per share for 2.28 billion outstanding shares, a 114% premium over Haitong International Securities’ last closing price of HK$0.71, the unit said in a statement.

Those shares would then be cancelled after the deal closes.

Haitong International Securities said the proposal to go private was due to an uncertain business outlook.

Reuters has previously reported that Shanghai’s Haitong Securities was planning a buyout to stem the unit’s losses.

The unit suffered a net loss of HK$6.5 billion in 2022 and a net loss of HK$780.9 million for the first half of this year.

The deal will be conducted via a wholly owned unit, Haitong International Holdings.

Trading in Haitong International Securities’ stocks and bonds has been suspended since Sept. 27 pending an announcement under the takeover code. It has applied for a resumption in trade from Oct. 9.

($1 = 7.8313 Hong Kong dollars)

(Reporting by Poonam Behura in Bengaluru and Summer Zhen in Hong Kong; Editing by Edwina Gibbs)