China’s first private bank, Minsheng Banking Corp, has agreed to purchase nearly 10% of UCBH holdings.
Minsheng told the Shanghai Stock Exchange that it will buy 9.9% of the San Francisco lender in two parts, with the option to increase its stake to 20%.
According to the ChinaDaily.com, Minsheng will pay between $97 million and $145 million for the 4.9% stake in the company. They will pay $17.79 a share for 5.35 million shares in UCBH and a further sum of between $115 million and $172 million will increase its ownership further to a total of 9.9%.
Minsheng could also increase its stake to 20% by buying secondary shares or by issuing primary shares, which would be issued at a premium of 15% above the previous days closing price.
This is the first time a Chinese mainland commercial bank has moved on a US bank. The bank has until 30 June 2009 to take up this offer, according to the website.