Telecom Equipment News
- TCL's holder to sell stake
Date: 3-Jan-2007 Sources: (Shenzhen Daily)
DOMESTIC television and mobile-phone maker TCL Corp. said Friday its major shareholder will sell a 5 percent stake in the company for a total of 204.5 million yuan (US$25.34 million).
TCL said in a disclosure that 89 company executives have agreed to buy 99.32 million shares, or a 3.84 percent stake, from its largest shareholder, a State-owned firm whose Chinese name translates as Huizhou Municipal Investment Holding Co. The executives include members of its board of directors and the board of supervisors, its president and vice presidents.
Meanwhile, Alliance Fortune International has also signed an agreement with TCL's largest shareholder to acquire 30 million shares, or a 1.16 percent stake.
The shares to be sold will be priced at 1.5816 yuan each, TCL said in a statement published in the China Securities Journal.
The share price is based on TCL Corp.'s end-September net asset value of 1.58 yuan a share, the statement said.
TCL said the stake sale is still pending approval from the State-owned Assets Supervision and Administration Commission, and the Ministry of Commerce.
It also said the shares being sold to Alliance Fortune and the company executives are nontradable shares, which means the buyers will have to participate in the company's share reform. The reform is part of a nationwide program by the government to float massive amounts of nontradable shares.
TCL said the buyers will have to offer 1.5616 free shares for every 10 tradable shares held by public investors to compensate for a price drop following the reform.
That would bring their actual cost for the stakes to 1.87 yuan a share, it said.
Officials at TCL Corp. and Huizhou Municipal Investment Holding weren't immediately available for comment Friday.
Huizhou Municipal Investment Holding earlier agreed to sell a 5 percent stake in TCL Corp. to Philips Electronics China BV, a unit of Royal Philips Electronics for 204.5 million yuan.
The deal, which is also pending government approval, would bring Philips' total stake in TCL to 7.46 percent, making it the third largest shareholder of the company.
Huizhou Municipal Investment Holding will eventually reduce its stakes in TCL to 15.22 percent from the current 25.22 percent, after all of these stake sales are completed. But the State-owned firm will remain the largest shareholder of TCL Corp.
TCL's shares, which have been suspended since Dec. 12 because of the share reform, last traded at 2.34 yuan.
Sponsor Results:
