Banking News
- ICBC to take control of Macao bank
Date: 31-Aug-2007 Sources: (Shenzhen Daily)
INDUSTRIAL and Commercial Bank of China (ICBC), the world's largest lender by market value, said Wednesday it would pay 4.68 billion patacas (US$583 million) for 80 percent of Macao's Seng Heng Bank, giving it a foothold in the booming gaming territory.
While the deal is small for ICBC, it gives the Hong Kong and Shanghai-listed lender access to a market that has seen gaming revenue overtake that of the Las Vegas strip, with billions of dollars in investment planned by global casino and hotel operators.
ICBC is buying 10 percent of the bank from director Patrick Huen, who will retain a 20 percent stake, and the 70 percent in the bank held by casino tycoon Stanley Ho's conglomerate, Sociedade de Turismo e Diversoes de Macao (STDM).
Macao, about an hour's ferry ride from Hong Kong, has boomed since Ho's four-decades-long gaming monopoly lapsed in 2002.
This week, the Las Vegas Sands opened the Venetian Macao, the world's biggest casino, as part of a US$24 billion bid by more than a dozen casino, hotel and retail operators to build a Las Vegas-style 'neon alley?along a stretch of reclaimed land called the Cotai Strip.
Seng Heng Bank, the territory's third-largest lender, had total assets of 25.39 billion patacas at the end of 2006.
The deal values Seng Heng at about 3.25 times 2006 book value. By comparison, mid-tier Hong Kong lender Bank of East Asia trades at about 2.5 times book.
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