HSBC Holdings Plc (HSBA), faced with growing concern its plan to sell a $9.4 billion stake in Ping An Insurance (Group) Co. will fail, said it has no material information to disclose about the negotiations.
“HSBC confirms that it is not aware of any information which must be announced to avoid a false market” in its own shares, the London-based bank said in a statement yesterday prompted by Hong Kong’s market regulators. The announcement of the proposed sale “remains accurate,” the lender said.
Concern is growing that Chinese regulators may block the transaction, according to Goldman Sachs Group Inc. analysts Mancy Sun and Ning Ma. The sale is part of HSBC Chief Executive Officer Stuart Gulliver’s plan to boost returns by selling assets to focus on growing economies in which the bank has the greatest market share.
The China Insurance Regulatory Commission is leading a preliminary review of the application for the transaction, the watchdog said in a statement yesterday. Separately, China Development Bank, which had agreed to help finance the purchase by Thai billionaire Dhanin Chearavanont’s Charoen Pokphand Group Co., canceled its loans, China’s Caixin Online reported Jan. 8.
“If HSBC had some bad news to tell the market, they would, I think,” Sandy Chen, an analyst at Cenkos Securities in London, said by telephone. “I think there’s some room in there for other lenders to step in.”
HSBC rose 1.2 percent to HK$84.15 in Hong Kong trading today, while Ping An gained 0.3 percent to HK$68. The benchmark Hang Seng Index increased 0.5 percent.
HSBC agreed on Dec. 5 to sell its 15.6 percent holding in Ping An to four subsidiaries of CP Group in two phases. The first stage, comprising shares valued at about HK$15 billion ($1.9 billion), was scheduled for Dec. 7. The sale of the remaining shares requires approval from CIRC by Feb. 1, or else an extension of the accord.
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