OCBC Bank has succeeded in its $6.23 billion bid to acquire Hong Kong's Wing Hang Bank, a triumphant conclusion to the biggest takeover the Singapore lender has ever launched.
By the close of the voluntary offer for Wing Hang at 4pm yesterday, the offer had been accepted by 97.52 per cent of the Hong Kong bank's shareholders, allowing OCBC to take Wing Hang private, it said in a statement.
The announcement comes two weeks after the Singapore bank said in an update that its offer to buy the Hong Kong lender's shares - at HK$125 (S$20) apiece in cash - had been accepted by 50.4 per cent of Wing Hang's shareholders.
Last week, it was reported that Aberdeen Asset Management, Wing Hang's third-largest shareholder, had agreed to sell its 7.4 per cent stake to OCBC.
Aberdeen also owned 6.8 per cent of OCBC as at May 7, according to Bloomberg.
Yesterday's final tally means that hedge fund Elliott Capital Advisors, which boosted its stake in Wing Hang to 7.8 per cent after OCBC launched its offer in April, has likely tendered its shares.
The fund, run by American billionaire Paul Singer, had bought 8.7 million shares in Wing Hang early this month at HK$125 a share, the same price as OCBC's offer.
Analysts saw the move as a plan to put pressure on OCBC to raise its offer price.
But the Singapore bank stood firm on its offer and declined to raise its bid.
As the level of acceptances for OCBC's offer has reached at least 90 per cent, the Singapore bank will be able to compulsorily acquire the remaining shares in Wing Hang from shareholders who have not accepted the offer.
Wing Hang will become a fully-owned subsidiary of OCBC, which will apply to delist the shares of the family-owned lender from the Hong Kong Stock Exchange.
OCBC group chief executive Samuel Tsien said yesterday that the bank was "very pleased with the outcome" of the takeover offer.
The bank will now "work through the required process to take full ownership of Wing Hang Bank" and will move more quickly to integrate the operations and businesses of the two banks, he said.
"Wing Hang Bank gives OCBC more access in the Greater China region," Mr Tsien added.
"We can offer a wider selection of services to Wing Hang Bank's customers as well as to Chinese companies expanding into Singapore and South-east Asia, where we have a dominant presence."
With Wing Hang's network of 70 branches across Hong Kong, Macau and mainland China, OCBC will now have a total of 88 branches in the Greater China region.
The bank had previously said that acquiring Wing Hang will increase its access to yuan liquidity and help grow its yuan-denominated business.
The deal will also allow the Singapore lender to cross-sell its private banking and wealth management services to Wing Hang's customer base, which includes bosses of small and medium-sized enterprises as well as affluent individuals, OCBC's chief financial officer, Mr Darren Tan, told The Straits Times earlier this month.
At the same time, Wing Hang can make use of OCBC's "regional platform, sales management and product expertise to give its customers access to a wider range of capabilities", Mr Tan added.
OCBC's acquisition of Wing Hang was advised by Bank of America Merrill Lynch and JPMorgan.
OCBC shares closed two cents higher, or 0.21 per cent, yesterday at $9.76. The broader Straits Times Index rose 0.17 per cent.
