Thursday, May 08, 2008

China Merchants back in with a shot at Wing Lung Bank deal

China Merchants Bank (CMB) is now on Wing Lung Bank's list of preferred bidders after another candidate pulled out, the Wall Street Journal reported. CMB joins the shortlist after initially being left out by majority shareholders of Hong Kong-based Wing Lung Bank, who preferred Australia and New Zealand Banking Group, Industrial and Commercial Bank of China, and Bank of Communications (Bocom). However, Bocom pulled out of bidding soon after starting due diligence for reasons that are not clear. The family that controls Wing Lung Bank is looking to sell its majority holding, which would trigger a tender offer for all outstanding shares in the bank, bringing the total potential sale price to more than US$5 billion. CMB's reentry in the bidding process could raise the eventual sale price.

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