Way of life Worldwide’s Shares Rise Sharply on Privatization Supply

By Yi Wei Wong

Shares of Way of life Worldwide Holdings Ltd. leap in early commerce after the corporate mentioned its majority stakeholders plan to take the Hong Kong-based retail operator non-public.

Way of life Worldwide’s shares rose as a lot as 50% to 4.63 Hong Kong {dollars} (US$0.59) after it introduced the privatization provide Monday. Shares had been final up 45% at HK$4.45.

In a inventory change discover, the corporate mentioned its majority stakeholders made a proposal to buy 376.8 million shares at HK$5.00 every, a 62% premium to Way of life Worldwide’s closing value on Friday.

Way of life Worldwide mentioned one of many essential causes for the provide was a downturn in Hong Kong’s retail atmosphere brought on by citywide protests in mid-2019 and the next Covid-19 outbreak in early 2020.

The acquisition will likely be financed utilizing a non-revolving credit score facility, the corporate mentioned. Way of life Worldwide will delist if the provide is profitable.

The proposed privatization was a “constructive shock,” Citi analysts write in a observe.

“Given the considerably decreased investor curiosity, proven by weak inventory liquidity, and the depressed valuation after the pandemic and border closure, we consider the privatization is an affordable motion,” the analysts say.

Write to Yi Wei Wong at [email protected]

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