Guangzhou Auto vows to privatise Denway and list in Hong Kong

The privatisation offer is valued at about $3.3 billion and will be an all-share transaction, while the listing of Guangzhou Auto will see no new shares being issued.

Guangzhou Automobile, China's largest car maker and a partner of Toyota, yesterday said it is seeking a listing in Hong Kong by the end of July and will simultaneously privatise its 37.9%-owned affiliate Denway Motors, which has been trading in Hong Kong since 1993.

Guangzhou Auto will sell no new shares in connection with the listing, but because it will pay Denway's existing shareholders with shares -- no cash will change hands -- those who now own Denway stock will instead become shareholders of Guangzhou Auto. Based on the mid-point of the estimated valuation range for Guangzhou Auto and the share exchange ratio, Guangzhou Auto will have to fork out about HK$25.7 billion $3.3...

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