GS

China's Guolian Securities to acquire Sinolink Securities

Guolian Securities Co said on Sunday it would acquire Sinolink Securities Co through a share swap and stake purchase, a move that accelerates the consolidation of Chinese brokerages.

Repeats story from Sunday with no change to text

Sept 20 (Reuters) - Guolian Securities Co 1456.HK601456.SS said on Sunday it would acquire Sinolink Securities Co 600109.SS through a share swap and stake purchase, a move that accelerates the consolidation of Chinese brokerages.

The announcement comes as privately run financial conglomerates such as Changsha Yongjin Group, which controls Sinolink, are under pressure to restructure, with Beijing tightening supervision of financial holding firms.

The move also comes as China encourages mergers of the country's brokerages to create stronger players to compete with foreign giants such as Goldman Sachs GS.N and Morgan Stanley MS.N.

Guolian plans to issue China-listed A-shares to all Sinolink shareholders in an equity swap, Guolian said in filings to the Shanghai Stock Exchange. In addition, it would buy a 7.82% stake in Sinolink from Yongjin.

The two firms did not disclose the value of the acquisition or further details, saying these have "yet to be negotiated."

The merger still contains uncertainties, so Shanghai shares of both firms will be halted from Monday, a suspension expected to last up to 10 trading days, according to the statements.

Sinolink, with a market capitalization of 46.27 billion yuan ($6.84 billion) according Refinitiv data, saw its Shanghai-listed shares surge 10% on Friday ahead of the announcement.

Backed by the government of the southern city Wuxi, Guolian is worth 39.42 billion yuan.

China is pushing to combine second-tier players like First Capital Securities 002797.SZ with Capital Securities.

($1 = 6.7675 Chinese yuan renminbi)

(Reporting by Shivani Singh in Ningbo, Cheng Leng and Sophie Yu in Beijing, Samuel Shen in Shanghai; Editing by William Mallard)

((ShivaniSingh2@thomsonreuters.com; +861056692115; Reuters Messaging: shivanisingh2.thomsonreuters.com@reuters.net))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

GS MS

Reuters

Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day. Reuters provides trusted business, financial, national, and international news to professionals via Thomson Reuters desktops, the world's media organizations, and directly to consumers at Reuters.com and via Reuters TV.

Learn More