Goldman Sachs Further Reduces ICBC Stakes, Raising $1Bln01-29 14:30 Caijing
Goldman Sachs Group Inc. has reportedly further sold down its stake in China's biggest lender Industrial & Commercial Bank of China, raising around 1 billion U.S. dollars.
1.35 billion shares of the Hong Kong-listed company were sold at 5.77 Hong Kong dollars each, 3 percent lower than the Chinese lender's closing price of 5.95 Hong Kong dollars yesterday, the Wall Street Journal said, citing two people with direct knowledge of the matter.
This has been the fifth time for the Wall Street bank to sell down ICBC shares since 2006, reflecting the bank's prudent risk management. The block trade, the biggest share sale in Asia so far this year, is expected to leave Goldman Sach's ICBC stake at below 5 percent, a level at which HSBC doesn't need to disclose underweight information as a big shareholder.
The ICBC investment has proved to be lucrative for Goldman Sachs. Including this block trade, the Wall Street has raised 8.76 billion U.S. dollars by selling shares in ICBC, according to filings to Hong Kong Stock Exchange. That represents a 3.4 times of return for Goldman Sachs, who first bought a 4.9 percent stake in ICBC for 2.58 billion U.S. dollars in 2006.
Shares of ICBC have gained 5.6 percent so far this year and about 12 percent since Goldman Sachs's private-equity funds sold a 2.5 billion U.S. dollars stake in April to Singapore's Temasek Holdings Pte.
While Goldman Sachs is selling its ICBC stakes, Blackrock has been raising its shares in ICBC from October 2012, boosting its share in the Chinese lender to 5.81 percent until last Tuesday, from 5.02 on October 11.
Buyers of the Goldman Sachs sale have remained unknown, but a source told the WSJ that the U.S. company still holds a small stake. The source, familiar with the situation, also said the sale was two to three times covered.
Goldman Sach's offload may have reflected foreign investors' pessimism over China's banking industry in the years ahead due to lurking risks among the country's shadow banking system, according to Cai Qingwei ,a well-know financial columnist in Hong Kong.
Editors’ Picks »
- 1China’s Exports Fall in Feb. Within Expectation: Ministry of Commerce
- 2Zhou Xiaochuan: China to Lift Controls on Deposit Interest Rates in 1 or 2 Yrs
- 3Australia Slips to Second Destination for Chinese ODI: KPMG
- 4Debris Spotted Possibly from Missing MH370: Vietnam Navy Officials
- 5Highlights of Li’s Press Conference
- 6Shanghai Index Plunges on Slowdown Concerns
- 7Tencent Buys 15pc Stake in Chinese Online Retailer Jingdong
- 8Malaysia Tracked Missing Jet to West Coast: Reuters
- 9Missing Jet May Have Disintegrated:Source
- 10Herbalife Shares Fall Following FTC Probes Announcement