Sun Hung Kai & Co., which is backed by CVC Capital Partners, is mulling a sale of its SHK Financial unit, a brokerage and wealth management business, Reuters reported. No details were released, though Reuters reported that the company had held “informal discussions” with potential buyers. CVC agreed last year to buy up to 19% of Sun Hung Kai, paying about $275 million.
(Reuters) – CVC Capital Partners-backed Sun Hung Kai & Co is considering selling a stake in its brokerage and wealth management business, a source familiar with the matter told Reuters on Tuesday.
The company has held informal discussions with potential buyers for its SHK Financial unit, the source added. Shares in Sun Hung Kai jumped 13 percent on the news of possible stake sale in the unit, outpacing a 1.3 percent rise in the benchmark Hong Kong share index .
Bloomberg, which first reported the news, said SHK Financial had a net book value of about HK$4 billion ($513 million).
“As a listed company Sun Hung Kai is obliged to and will make appropriate announcements regarding any M&A activities, Sun Hung Kai said in a statement.
“Management will continue to explore opportunities to expand our business operations for the benefit of shareholders,” the statement added.
Sun Hung Kai is a non-bank institution has about HK$60 billion under management and advice. CVC was not available for immediate comment. Last year, CVC agreed to buy an up to 19 percent stake in Sun Hung Kai for about $275 million.
The source declined to be identified as the matter was private.
($1 = 7.792 Hong Kong Dollars) (Reporting by Stephen Aldred and Joy Leung; Editing by Jonathan Hopfner and Lincoln Feast)