Geely Automobile Holdings Ltd. (175) fell the most in three months in Hong Kong trading after Goldman Sachs Principal Investment Area sold shares at a 7.8 percent discount.
The Volvo Car affiliate fell as much as 4.5 percent, the most on a closing basis since Aug. 22, to HK$3.51 and traded at HK$3.49 as of 10:45 a.m. local time. Goldman Sachs Principal Investment Area sold 600 million shares at HK$3.30 each, the low end of a marketed price range, according to a person with knowledge of the matter. The Standard newspaper reported that the fund was seeking to sell shares earlier today.
Geely shares more than doubled this year, while Hong Kong’s benchmark Hang Seng Index rose 18 percent. The Zhejiang, China- based automaker sold bonds convertible into 908.4 million new shares at HK$1.90 apiece and warrants transferrable into 299.5 million new shares to a fund managed by Goldman in September 2009.
“I think Goldman is selling 600 million shares from a combination of the convertible bonds and the warrants,” said Steve Man, a Nomura Holdings Inc. analyst in Hong Kong with a buy rating on the stock. “It’s a pretty good return for them over the last three years.”
Lawrence Ang, executive director at Geely, didn’t reply to an e-mail seeking confirmation and details of the sale.
Geely, which has targeted becoming China’s biggest car exporter in two years, reported profit increased 8.7 percent in the first six months of the year and forecast a “more challenging” second half on rising competition.
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