New World Department Store’s privatisation plan fails to garner required support from shareholders
Company received 83.90pc approval of privatisation by independent shareholders, just shy of the 90pc required by law
Plans by the parent firm of New World Department Store China to take it private for HK$934.5 million have failed, after not managing to garner enough support from independent shareholders for a full buyout of the operation.
By the end of its final closing date on Monday, New World Department Store had received valid acceptances representing 83.90 per cent of shares owned by independent shareholders, just shy of the 90 per cent required to proceed under company law.
Thus “the offer has not become unconditional and is lapsed from 28 August 2017”, according to a company filing to the Hong Kong stock exchange.
Shares of New World Department Store lost 5 per cent to close at HK$1.9 after the announcement.
New World Development, which owns 72.3 per cent of New World Department Store, offered HK$2 a piece in June to buy out all the shares it did not already own, in what it said was a bid to better cope with a challenging retail operating environment.
Despite the price representing a 50 per cent premium over its last closing price before the company disclosed the privatisation plan, it was still 66 per cent below its listing price 10 years ago, of HK$5.8 per share.