A Singapore-based financial services firm, the second largest lender in Southeast Asia, offered to acquire the eighth largest lender in the state, a Hong Kong bank, for a premium cost per share. Three months afterward, a multi-billion hedge fund firm located in the USA had gathered close to 8 per cent of the Hong Kong bank’s shares.
OCBC Versus Elliott Management Acquisition of Wing Hang Bank Case Study Solution
Based on Hong Kong’s securities law, the Singapore-based financial institution would need to get 90 per cent of the Hong Kong bank’s shares to take the bank private, and there were only 25 days left for the business to satisfy this condition. The hedge fund firm’s implicit message was lucid: increase your bid price to purchase our shares or the business people will be kept by us at your expense.
Learning Objective: This case is suitable for undergraduate and/or graduate classes on corporate finance and corporate strategy. The learning objectives are:
To exemplify the challenges involved in a cross-border bank acquisition.
To illustrate the potential roadblocks investor activism can create in a company acquisition.
To identify the strategies to consider when entering a brand new market and when coping with investor activism.
To learn about the competitive landscapes for the banking industry in Southeast Asia, specifically Singapore and Hong Kong.
To discuss RMB internationalization and the strategic opportunities connected with it.
Publication Date: 07/15/2015
This is just an excerpt. This case is about Finance
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