HK's Bank of East Asia to review assets with support of Elliott Management (updated)

The Bank of East Asia

04/03/2020 01:37

* Hires Goldman Sachs for review of business portfolios and
assets
    * Elliott to apply for a stay of judicial proceedings    

 (Adds review details, context)
    HONG KONG, March 4 (Reuters) - Hong Kong-based Bank of East
Asia Ltd (BEA)  0023.HK , said on Wednesday it would carry out a
comprehensive review of its portfolio of businesses and assets
with the support of activist investor Elliott Management. 
    A long-running dispute between Elliott and the bank's
directors was due to be heard in a Hong Kong court in early May,
but BEA in its statement said Elliott would apply for a pause of
those proceedings. 
    Elliott has previously urged the bank - which counts Hong
Kong and mainland China as its main markets - to explore putting
itself up for sale in an open letter to shareholders, in which
it also said BEA was poorly run by its current management.  
    The U.S. hedge fund had also filed a lawsuit against the
bank in protest over a share placement.
    BEA shares rose more than 1% in Hong Kong early trade after
the announcement.
    BEA has survived as an independent lender in a market that
is dominated by HSBC Holdings PLC  HSBA.L , BOC Hong Kong
Holdings Ltd  2388.HK  and Standard Chartered PLC  STAN.L ,
while several of Hong Kong's other family-owned firms have been
put up for sale amid deteriorating business conditions.
    The review will focus on identifying potential transactions
that "would enhance the value of the Bank's existing businesses
and assets, as well as strategic alternatives for potentially
non-core assets," BEA said in its statement.
    The bank said it has hired Goldman Sachs for the review, and
it will give an update about the process by June 30.
    Elliott supports the review, Jonathan Pollock, co-chief
executive and chief investment officer of Elliott, was quoted as
saying in BEA's statement. 
    An Elliott spokesperson said the U.S. hedge fund had nothing
further to add to BEA's statement.

 (Reporting by Alun John and Sumeet Chatterjee; Editing by Tom
Hogue and Christopher Cushing)
 ((Alun.John@thomsonreuters.com; +852-28415827;))