Rumours of big ICBC stake sale weigh on stock
Naomi Rovnick and Wong Ka-chun
Shares in Industrial and Commercial Bank of China (ICBC) came under pressure yesterday amid rumours that billions of dollars worth of the mainland lender's shares were about to flood the market.
Six Hong Kong fund managers reported they were called by brokers claiming to have a large block of ICBC shares to sell.
Strategic investors who bought stakes in ICBC in 2005 - Goldman Sachs, American Express and German insurer Allianz - will be allowed to sell their shares from April 28.
But the three strategic investors had said previously they would not put ICBC shares on the market as this would depress the mainland lender's stock.
Instead, they said they would prefer private placements, off-market deals where they could transfer their holdings to other investors without disrupting the share price.
'Brokers called me twice after the market opened in the afternoon session and said a substantial investor in ICBC was trying to offload shares in the bank to reap at least HK$1.6 billion,' a fund manager said.
ICBC fell 0.97 per cent to close at HK$4.07 while the Hang Seng Index rose 23.72 points to 14,545.69.
Goldman has a 4.9 per cent stake worth HK$71.3 billion in ICBC. It plans to sell 20 per cent of its holding after April 28, when a first lock-up agreement on the stake expires.
Allianz owns 2 per cent of the lender and American Express has 0.4 per cent.
Hong Kong's richest man, Li Ka-shing, is said to be a potential seller of ICBC shares, but his spokesman said that 'is absolutely not correct'.
Another fund manager said he was told the shareholder was willing to sell the shares at HK$3.70 each, a 9.09 per cent discount to ICBC's closing price yesterday.
'There were various versions of the share sale,' the fund manager said.
'Some [brokers] indicated that the seller hoped to sell as many as 400 million shares but somebody said it was 100 million shares only.'
The seller was unlikely to be Goldman, sources said. The US bank would probably not hire outside brokers to sell shares.
ICBC declined to comment.
Li Ka-shing among names mentioned as potential seller
Fund manager said a big investor was trying to sell ICBC shares worth, in HK$: $1.6b