Malaysia’s CIMB completes $121m sale of 50% stake in stockbroking biz to China Galaxy

A staff attends to a customer at a branch of CIMB Bank in Kuala Lumpur December 8, 2009. REUTERS/Bazuki Muhammad

Malaysian bank CIMB Group Holdings Berhad (CIMB), and China Galaxy Securities Co Ltd, have completed their co-ownership deal in CIMB Securities International Pte Ltd (CSI), the holding company of CIMB’s ex-Malaysia stockbroking business.

Both companies through their wholly-owned subsidiaries CIMB Group Sdn Bhd, and China Galaxy International Financial Holdings Limited (CGI), closed a share purchase agreement making them 50:50 shareholders in CSI.

Among CSI’s stockbroking activities involve institutional and retail brokerage, equities research, and associated securities businesses across Indonesia, Singapore, Thailand, Hong Kong, South Korea, India, UK, including the US.

CIMB’s group chief executive Tengku Dato’ Sri Zafrul Aziz, and China Galaxy Securities deputy chairman and executive Gu Weiguo, signed the deal in Beijing on Tuesday (June 6), where the Chinese firm bought CGI’s 50 per cent stake in CSI for up to $121 million (SGD167 million or RM515.0 million).

Price of the acquisition was based on a multiple of 1.3 times of CSI’s consolidated net asset value of SGD256.9 million in December 31, 2015.

CIMB is a leading ASEAN universal bank, while China Galaxy Securities is one of the largest Chinese securities companies.

The joint venture is expected to occupy a wider country agenda, being poised to further capitalise on China-outbound M&As, China-ASEAN cross-border investments and infrastructure funding. China’s Belt and Road initiative was noted to facilitate growth, consumption and capital flows into the region.

“CIMB’s stockbroking business will effectively be re-positioned as a pure play broker with the client base of a universal ASEAN bank,” Zafrul said. “We will continue to offer the full suite of investment banking and capital markets services to our clients, supplemented by the extensive equities distribution platform and research coverage of the joint venture.”

Following the signing of the ex-Malaysia share purchase agreement, the parties will work towards obtaining the necessary regulatory approvals with a target to complete by the fourth quarter of 2017.

The parties are also in discussions with respect to the Malaysia stockbroking business.

Also Read:

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Malaysia’s CIMB takes forward Asean dream, sets foot in Vietnam

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.