Stocks News
- Goldman bid for Midea stake blocked
Date: 31-Aug-2007 Sources: (Shenzhen Daily)
THE country's top securities watchdog has rejected a plan by domestic appliance maker Midea Group to sell a stake to an investment arm of Wall Street bank Goldman Sachs, Midea said Thursday.
Midea, a private company that is one of China's biggest makers of appliances, has long planned to sell a 10.7 percent stake to GS Capital Partners of Goldman for 717 million yuan (US$91 million).
The plan was vetoed by the China Securities Regulatory Commission at a review Wednesday, Midea said in a statement, without giving a reason.
The Shanghai Securities News cited analysts as saying it was probably because the government did not want to see Midea sell its stake too cheaply to Goldman, which has made a string of acquisitions in the world's fastest-growing major economy.
The proposed deal had been approved by the Ministry of Commerce. Midea has said Goldman would buy 75.6 million new shares for 9.48 yuan each.
'The price was too low, that's why the deal didn't pass,'' said Fu Juan, an analyst at Shenyin Wanguo Research and Consulting Co. in Shanghai.
Shares of Midea, a manufacturer of air conditioners, freezers and dishwashers, have gone up about 600 percent since November when Midea signed an agreement to sell a stake to Goldman through private share placement.
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