The state-held China Construction Bank plans to withdraw BibBanco from trading on the stock market after it completes the purchase of shares still in the possession of minority shareholders, the Brazilian press reports.
Late last October China Construction Bank signed an agreement to purchase 72 percent of the capital of BibBanco, a financial institution that specialises in financing small and medium sized companies, for 1.621 billion reais (US$523 million), paying a premium of 18.6 percent with respect to the share price.
That operation was subject to approval by the Central Bank of Brazil and the President of the Republic, and is China Construction Bank’s first acquisition outside Asia.
Professor José Ricardo Barbosa Gonçalves of the Unicamp Economic Institute told the Bank Union’s magazine Bancário that the decision to withdraw the bank’s shares from quoting on the market was meant to relieve shareholder pressure on its management.
The decision, which depends on the sale of the 28 percent of shares still in the possession of minority shareholders, also means that China Construction Bank aims to implement orientations set by the Chinese government, although accompanying Brazilian market conditions, Barbosa Gonçalves said.
A statement released by the Brazilian market regulator indicated that BibBanco will remain a commercial bank which focuses on providing services to medium sized companies. (macauhub)