HSBC Puts Conditional Proposal to Take Hang Seng Bank Private

HSBC Holdings plc announced today that it has submitted a conditional proposal, through its subsidiary The Hongkong and Shanghai Banking Corporation Limited (HSBC Asia Pacific), to privatise Hang Seng Bank Limited via a scheme of arrangement. If approved, the move would see HSBC Asia Pacific acquire all remaining shares of Hang Seng held by minority shareholders, leading to the bank’s delisting from the Hong Kong Stock Exchange.

So, under the proposal, shareholders would receive HK$155 per share — a 33% premium to Hang Seng’s 30-day average closing price of HK$116.5. The offer values Hang Seng at approximately HK$290 billion, reflecting a 1.8x price-to-book multiple based on first-half 2025 results. HSBC has confirmed that this offer is final and will not be increased.

HSBC Puts Forward Conditional Proposal to Take Hang Seng Bank Private

The deal will be fully under finances through HSBC Group’s own financial resources, with an estimated day-one capital impact of around 125 basis points, pending approval at the required shareholder and court meetings. Following the transaction, HSBC aims to restore its Common Equity Tier 1 (CET1) ratio to its target range of 14.0–14.5% through organic capital generation, while pausing new share buybacks for three quarters. The bank reaffirmed its 2025 dividend payout target of 50% of earnings per ordinary share, excluding notable items.

So, HSBC stated that the proposed acquisition is going to be accretive to earnings per share and aligns with its strategy of driving value-accretive investments that enhance growth and shareholder value.

Group CEO Georges Elhedery described the proposal as “an exciting opportunity to grow both Hang Seng and HSBC,” adding that the bank remains committed to preserving Hang Seng’s brand and identity while enhancing its products, technology, and customer experience. He emphasized that the move reflects HSBC’s confidence in Hong Kong’s economy and its pivotal role as a global financial hub and gateway to mainland China.

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