Haier Electronics Group Co.’s shares jumped Tuesday after the world’s biggest maker of household appliances said its controlling shareholder is exploring a plan to take it private.
Shanghai-listed Haier Smart Home, the controlling shareholder of Haier Electronics, plans an initial public offering in Hong Kong and offers minority shareholders in the unit its newly issued H shares in exchange for their shares. If the privatization is completed, Haier Electronics will delist from the Hong Kong Stock Exchange, Haier Electronics said in a statement.
Haier Smart Home and Haier Electronics are two major listed platforms of Haier Group. Haier Smart Home holds 45.64% of Haier Electronics. An overseas subsidiary of Haier Group holds a 12.01% stake in Haier Electronics.
Haier Electronics, as an independent Hong Kong-listed company, is controlled by Haier Smart Home, a structure that has many drawbacks, home appliance industry analyst Liu Buchen told Caixin. The structure has led to confusion about the valuation of Haier Group’s home appliance business and overlapping internal management, which increases operating costs and affects management efficiency, Liu said.
Shares of Haier Electronics surged more than 9% to HK$23.90 ($3.07) Tuesday. The stock traded as high as HK$26.20 after trading resumed Tuesday. Trading had been halted since Friday.
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