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Handover fear prompts HK companies to divest assets

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SCMP Reporter

TWO Hong Kong companies, including one listed on the stock exchange, are looking for ways to send assets out of the territory and into Britain ahead of next year's handover.

It is also understood that high net worth individuals are also seeking ways of diversifying their portfolios.

Nervousness over the resumption of Chinese sovereignty over Hong Kong, combined with a more favourable investment environment in Britain, is seeing an increasing amount of capital flight from the territory into safer investments abroad.

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One London-based merchant bank, Guinness Mahon, wholly owned by the Bank of Yokohama, is aiming at Hong Kong companies and high net worth individuals looking for investment opportunities which might dilute their exposure to the territory.

It is already advising four large Hong Kong based investors, and its executives are to visit the territory next month in a bid to outline further potential investment opportunities in Britain.

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While it is common for Hong Kong individuals to buy prime properties in London as potential bolt-holes, there is now an increasing incidence of Hong Kong companies seeking London listed shell companies in which to inject funds.

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