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Hai Tong Securities Swallow plan Jie Mi

August 31, 2010

Mainland China investment bank's first international acquisition will make the trip.
January 13, 2010, through the Hai Tong (Hong Kong) Financial Holdings, Hai Tong Securities [19.19
0.26%] (600837.SH) will be the end of Tai Fook Securities in Hong Kong [4.95
1.02%] (0665.HK) of the Tender Offer.

If nothing else, Hai Tong Securities will be 1.822 billion Hong Kong dollars was Tai Fook Securities 52.86% of the shares after the company successfully retain their listing status. This time through the Secretariat by the sea as "Swallow plan" mergers and acquisitions, in addition to the usual business war bargaining strength and texture of each screening, the industry and the regulators were considered to be international M & A "beautiful battle."
However, this will be only the beginning. Adjacent to the mainland as international financial center, Hong Kong has become China's mainland investment banking and international M & A the most ideal one-stop operational. This newspaper has learned, in addition to the sea through, the State letter, Guo-Yuan, Mainland securities and other investment companies in the negotiation of Hong Kong's Chinese-owned investment bank, in order to open the road leading to internationalization.
"Swallow Scheme"
August 2009, after Bank of China International and HSBC Hong Kong, matchmaking, Tai Fook Securities are listed as the substantive goal of the sea through mergers and acquisitions.
Two months later, Hai Tong Securities on the due diligence investigation of Tai Fook Securities.

For confidentiality, in accordance with international practice, international sea links to the merger as a "Swallow" Program name, meaning that fly overseas. Previously, the city of Hai Tong Securities backdoor listing of the shares in time, it was called the "Eagle program."

According to informed sources, Hai Tong (Hong Kong) Financial Holdings Chief Executive Officer Lam Chung, Tai Fook Securities Company and its shareholders, the newly created (0659.HK) Executive Director, M & Religions are overwhelmed by the sea through with the newly created specific executor. The negotiations before and after the basic operation by them.
Lin Chung, now 40 years old 15 years in the investment industry working experience, and also was awarded the "2006 Outstanding Young Shanghai Ten Financial" title.

As the first sponsor in 2007, Lin Chung served 6 years from the sea through his position to his new post, general manager of investment banking Hai Tong as managing director. For M & A, Lin Chung indeed already do well, which is thought to be sent to Hong Kong that year was appointed to important causes.
Mr Cheng, the son of Cheng, whose grandfather is a consortium of Hong Kong Top Ten - New World [15.10
1.96%] Development Group helmsman Cheng Yu-tung. Religions, 26-year-old, who work in the CLSA 3 years, mainly responsible for infrastructure sector analysis. January 2008, its joining the newly created, was elected in mid-2009 with the newly created Tai Fook Securities executive director.
Because there are investment banking background with Lin Chung and negotiations Religions exchange flow.
The two sides "see-saw" the focus than the maximum price. It is learned that has made the newly created 5.25 Hong Kong dollars / share purchase price, but it seems beyond the sea pass an acceptable price cap.
At 4 o'clock on the 19 November, up to 12 hours after the last talks with Mr Cheng Chung Lin finally shake hands. Hai Tong Hong Kong 4.88 Hong Kong dollars per share to create the new group [14.30
0.14%] Tai Fook Securities acquired 52.86% stake in the newly created Tai Fook Securities finally holding a 9% stake.
Sea Link International
In fact, the end of 2008, Hai Tong Securities in Hong Kong started searching out on M & A targets, and plans to complete in three years, Hai Tong complete platform to build.
Haitong CEO Ming Shan is the sea through international M & A leader. His military background, he is considered low-key and very bold and visionary. Earlier, Li Shan has said Haitong goal is clear: public, group, international.
At that time, the sea level set the tone through the acquisition target is two, one foreign investment bank, and second, the size and influence of large Chinese-owned investment bank.
Hai Tong Hong Kong has a number of business licenses, a small Chinese-owned investment bank of the Sea Link International is not really meaningful.
"Hai Tong to Hong Kong Chinese-owned investment banks basically talked about it again, now in the economic recovery of acquisition, be a good time to catch up." An insider told reporters.

Finalize goals for the Tai Fook Securities, also is impressive because of its overall strength, especially strong brokerage business. It is reported that Tai Fook Hai Tong Securities consistent with the acquisition of three elements: the large and influential business interaction with the sea through complementary, easy management and cultural integration.

Tai Fook Securities in Hong Kong's leading local brokerage, one of 15 million customers in Hong Kong and Macao has 12 branches. Compared with their domestic competitors, the acquisition will enable Hai Tong Tai Fook Securities in index futures and margin trading and other innovative business strategic advantage.

In 2007, Tai Fook Securities net profit of 4.84 billion Hong Kong dollars; as the market downturn, in 2008 net profit fell to 112 million Hong Kong dollars; first half of 2009 net profit of 76.75 million Hong Kong dollars.
Although Hai Tong has subsidiaries in Hong Kong, and holds nine licenses, but not compared with the great blessing. It is worth mentioning that in 2009, Hai Tong continuous participation in Minsheng Bank [7.91
0.25%] H shares, China Pacific Insurance [25.62
0.71%] H shares of the IPO, so that it gains little have expected to profit billions of dollars Hong Kong dollars.
This time, after the acquisition, because both belong to the sea-pass system, Hai Tong Tai Fook Securities in Hong Kong on business, then there exists the possibility of reverse integration.

Hai Tong Securities secretaries to directorate Jin Xiaobin frankly, the acquisition of Tai Fook Securities, to the capital through more efficient operation, as soon as possible to upgrade the sea through the overseas market share, make a big financial group in Hong Kong and the Asia-Pacific region radiation; while the sea through the ROE (return on equity rate) would also be effective to upgrade. Another purpose is as a training base.

In the evaluation of the purchase price, the Jin Xiaobin, said, "not cheap but reasonable." He pointed out that in the future, not just Tai Fook Securities, and the sea through the Hong Kong business will occupy the entire company a very important position.
It is reported that, apart from a small change in the board, the Tai Fook Securities of the management team will remain, it is also regarded as Tai Fook Hai Tong's most important asset.

Currently holding the securities as the main force of the Hai Tong Securities has begun to take shape, under the jurisdiction of the two fund companies, two direct investment companies, as well as Hong Kong's financial holding companies, and holding the futures company. Meanwhile, the sea through the acquisition of the Bridge Trust is also awaiting final approval.
Li Shan in accordance with the previous idea, the sea will also be acquired through some of the financial industry and build a complete platform. Internationalization, based in Hong Kong as the main platform.
Now, Hai Tong Tai Fook Securities in Hong Kong M & A, has a firm grasp of its international platform.
M & Start
This is the first time from mainland China's international investment bank mergers, the industry and regulators as a "beautiful battle."
It is reported that the Shanghai municipal government to the sea through the acquisition of a very high rating, also called Tai Fook Hai Tong after the acquisition of Shanghai to help establish an international financial center.

A broker who said in mid-December, the Department of the SFC agency meeting held in Xiamen, the agency officials had respect Tai Fook Hai Tong on M & A done "pretty." After an internal meeting in the Commission, the Commission Vice-Zhuang Xinyi Haitong also commended that the sound of the sea is not anything about this incident did not pass out - well done. However, at this meeting, regulators, On the Road, in the financial crisis, banks, insurance have become bigger and stronger domestic investment banks should also consider how to use the financial crisis become bigger and stronger.
In fact, after the financial crisis, Chinese financial institutions, whether banks, insurance, securities, the majority of overseas M & A is not successful, thus making the acquisition Haitong more worthy of attention.

In the industry view, the sea aside Europe and the United States through the investment bank, turned to the acquisition based on both internationalization and localization of the Hong Kong brokerage, prospective M & A targets in the business and cultural integration of both companies is feasible.
October 2007, when the financial crisis began, CITIC has announced the planned acquisition of U.S. investment bank, but is stopped short after 5 months. This also allows CITIC lucky to have dodged a bullet.

Since then, CITIC will put Hong Kong's international strategy, and increase the support of CITIC Hong Kong companies and investment. The number of domestic investment banks have begun consideration of the reality of the proximity to the Mainland's international financial center - Hong Kong as a bridgehead for international.
In fact, since the end of 2008, a number of brokers are considering is similar to the sea through the
"Swallow plans," planning international acquisitions. Among them, one after another major replenishment of the Hong Kong listed subsidiary of brokerage are considered to be ready to buy a prelude.
According to sources in Hong Kong investment bank, which has stepped up negotiations with the country element, Guoxin, investment and other securities firms. It is learned, such as Sun Hung Kai, Phillip, when the rich, the first Shanghai [1.23
-3.91%] Of domestic investment banks are all acquisitions by the opponent.

Filed under: Armored Iron Horse (Financial set)

Tags: financial, Hai Tong Securities, Hong Kong, Tai Fook Securities