Shares of Hong Kong-based brokerage Celestial Asia Securities Holdings (CASH) and subsidiary CASH Financial Services Group surged more than 15 per cent in early morning after a memorandum of understanding was signed on a possible sale of a stake in the unit to a potential mainland buyer.
But they soon gave up their gains as the firms cautioned that a deal might or might not be sealed.
“There is no assurance that any transactions referred to in this joint announcement will materialise or eventually be consummated,” CASH and its unit said in a joint statement.
CASH traded as much as 15.5 per cent higher at 82 HK cents but fell back to 69 HK cents at 10.51am. CASH Financial rose up to 19.7 per cent to 39.5 HK cents before falling to 33.5 HK cents.
The potential buyer, Tianjin Binhai new Area Construction & Investment Equity Fund Management, is a subsidiary of state-backed Tianjin Binhai New Area Construction & Investment Group. It is principally engaged in equity investment fund management, but also has interests in 32 industries from agriculture to property development.
The potential sellers are Celestial Investment Group, a wholly owned unit of CASH, which owns 41.1 per cent of CASH Financial, and Bankee Kwan Pak-hoo, the chairman of both CASH Financial and CASH.