CITIC holds a stake of 59% in KVB Kunlun after offers closure

LeapRate has been keeping you updated on the mergers and acquisitions wave that has been engulfing the Forex sector for the past couple of years. One more development on this front comes from Hong Kong-based retail Forex broker KVB Kunlun Financial Group Ltd (HKG:8077), whose robust financial and operating results have made it a lucrative target for Chinese investment giant CITIC Securities Company Limited (SHA:600030).

The Chinese bank completed a purchase of 1.2 billion shares in KVB Kunlun in May at a price of HK$0.65 per share. Under the Hong Kong laws, CITIC was obliged to submit a mandatory offer for the rest of the share capital of the broker.

On June 5, 2015, CITIC made the bids for the rest of KVB Kunlun’s capital, leaving many investors disappointed, as the offer per share remained the same at HK$0.65, representing hefty discounts on the market price of the broker’s shares. The options offer was also not very impressive at HK$0.236 per outstanding KVB Option.

As per today’s announcements, investors were not charmed by CITIC’s offers.

Upon the closure of the bids, CITIC received:

  • valid acceptances in respect of a total of 310,001 KVB Shares under the Share Offer (representing approximately 0.02% of the entire issued share capital of KVB Kunlun);

  • valid acceptance in respect of 4,390,000 Options under the Option Offer (representing approximately 25.96% of the total outstanding 16,910,000 KVB Options subject to the Option Offer).

After the closure of the offers, CITIC has an aggregated interest of 1,200,310,001 KVB Shares, representing approximately 59.04% of the entire issued share capital of KVB Kunlun.

The public now holds 32,729,999 KVB Shares, representing approximately 26.20% of the entire issued share capital of the broker. This is enough for the company to remain listed on the GEM market at HKEX.

Below is a table illustrating the shareholding structure of KVB Kunlun before and after the closure of CITIC’s offers.


To view the official announcement on the deal, click here.

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