(Yicai Global) June 11 -- The largest shareholder of China International Capital Corp. (CICC), Central Huijin Investment, signed an agreement with Haier Finance on June 6 to transfer 398.5 million shares or 9.5 percent of the total share capital of the company to the latter for CNY5.41 billion (USD845 million), the former stated June 7.
Haier Finance will become the second-largest CICC shareholder after the deal closes. Central Huijin will remain the company’s largest shareholder, but with its stake whittled down to 46.2 percent from 55.68 percent.
Founded in 1995, Beijing-based CICC is China's first Chinese-foreign joint-venture investment bank. It underwent a share restructuring and listed in Hong Kong in November 2015.
CICC has registered capital of CNY4 billion. It posted revenue of CNY15.3 billion last year, up nearly 71 percent annually, and net profit of CNY2.8 billion for a rise of 52 percent. Investment banking is its forte. It completed 12 A-share initial public offering projects with a lead underwriting amount of CNY10.25 billion last year. It also completed 14 A-share refinancing projects with a lead underwriting amount of CNY94.24 billion. It stood sponsor for Foxconn Industrial Internet, which listed on the Shanghai Stock Exchange on June 8.
Central Huijin’s shareholding adjustment may relate to the previous CICC merger with China Investment Securities. Before the merger, Central Huijin held a 28.57 percent stake in CICC and a 100 percent stake in China Investment Securities. After the merger, Central Huijin's shareholding holding in CICC rose to 58.65 percent.
Central Huijin’s shareholding ratio dropped to 55.68 percent after Tencent Holdings’ nearly 5 percent equity buy into CICC. Its shareholding in CICC will further fall to 46.2 percent after the equity transfer to Haier Finance.
Haier Electric Appliances International owns a 100-percent stake in Haier Finance and is also a controlling shareholder of shanghai-listed Qingdao Haier Co., of which it holds a 20.64 percent stake.
Editor: Ben Armour