Solid takeover hurdle trips up Foxconn of sneakers
11/04/2018 03:27
(The author is a Reuters Breakingviews columnist. The opinions
expressed are his own.)
By Quentin Webb
HONG KONG, April 11 (Reuters Breakingviews) - Taiwanese
contract footwear maker Pou Chen wanted full control of its Hong
Kong affiliate Pou Sheng. The $1.4 bln deal was nixed, however,
by just 4 pct of investors. There's a risk that the rigorous
system can be gamed, but it commendably tilts in favour of
outside shareholders.
Full view will be published shortly.
On Twitter https://twitter.com/qtwebb
CONTEXT NEWS
- Pou Sheng International said on April 9 that a proposed
HK$10.9 billion ($1.4 billion) sale to a related company had
been scrapped after some independent shareholders voted against
it. The following day, shares in the Chinese sportswear
retailer, which had been trading close to the HK$2.03 bid price,
fell 31 percent to HK$1.38.
- Pou Chen Corp, which says it is the world’s biggest maker
of branded athletic and casual footwear, unveiled the all-cash
offer in January. The Taipei-listed company owns just less than
50 percent of Hong Kong-traded subsidiary Yue Yuen Industrial,
which in turn owns 62.4 percent of Pou Sheng. Tsai Chi-jui, one
of Pou Chen’s founders, owns another 7 percent of Yue Yuen.
- The deal required approval via a court-based “scheme of
arrangement”. Under Hong Kong’s takeover code, deals like this
can be blocked if investors holding 10 percent or more of all
shares not connected to the transaction vote against it.
Shareholders owning 215 million Pou Sheng shares, representing
10.8 percent of all the stock held by outsiders, voted against
the transaction.
- Pou Chen cannot bid again for a year, unless it gets
approval from Hong Kong’s takeover regulator.
- For previous columns by the author, Reuters customers can
click on WEBB/
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<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Nike supplier risks own goal with $1.4 bln buyout
urn:newsml:reuters.com:*:nL4N1PH0R5
HK's Pou Sheng says plan to go private cancelled after
shareholder opposition urn:newsml:reuters.com:*:nL3N1RN1LL
Pou Sheng statement http://www.hkexnews.hk/listedco/listconews/SEHK/2018/0410/LTN20180410187.pdf
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
(Editing by Jeffrey Goldfarb and Katrina Hamlin)
((quentin.webb@thomsonreuters.com; Reuters
Messaging:quentin.webb.thomsonreuters.com@reuters.net))