Hong Kong’s Hang Seng Bank said on Monday that an independent board committee has concluded HSBC’s $13.6 billion proposal to take the bank private is fair and reasonable, and has urged minority shareholders to support the deal.
Under the offer, HSBC plans to acquire the remaining 36.5% stake in Hang Seng that it does not already own.
The transaction comes as HSBC pursues selective acquisitions to strengthen its strategic footprint while continuing to shed non-core assets, chief executive Georges Elhedery said when the deal was unveiled.
Hang Seng has faced mounting pressure in recent years due to its comparatively heavy exposure to the Hong Kong and mainland China property sectors.
Financial strains are expected to deepen for heavily indebted Hong Kong property developers and their lenders, with bond maturities forecast to surge by almost 70% next year.
Established in 1933, Hang Seng is among Hong Kong’s largest banks and a key member of the HSBC group. The lender serves around 4 million customers via digital channels and a network of more than 250 branches across the city.
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