CTBC Financial Holding has announced a revised plan to take over Shin Kong Financial Holding as it seeks to outdo a merger proposal between the latter and Taishin Financial Holding.
The board of CTBC Financial held an extraordinary meeting on 23 August 2024 and approved the revised plan to take over Shin Kong Financial, seeking to acquire 51% of its smaller rival, for NT$14.55 ($0.46) per share, said CTBC Financial President and spokesperson Rachael Kao at a news conference, reported Central News Agency.
The price is higher than that proposed by rival Taishin Financial for Shin Kong Financial.
The tender offer price to obtain one share of Shin Kong Financial common stock is a combination of NT$4.09 in cash and a 0.3132 share of CTBC Financial's common stock, Ms Kao said.
When CTBC Financial announced its takeover plan on 20 August, the target was to obtain 25% of Shin Kong through the open market, without disclosing the pricing of its tender offer at the time.
CTBC Financial's latest announcement was made after the boards of Taishin Financial and Shin Kong Financial separately passed a proposal to merge the two firms on 22 August.
Taishin Financial would swap 0.6022 shares of its common stock for one Shin Kong Financial share and exchange one preferred Taishin Financial share for a preferred Shin Kong Financial share, according to statements by the two companies. According to a market estimate, that would translate into an acquisition price of about NT$11.32 per Shin Kong share.
Ms Kao said CTBC Financial can offer a higher price because of its ability to create synergy, citing the company's success in turning around the loss-making Taiwan Life over the past decade.
CTBC Financial believes its takeover of Shin Kong Financial would also generate better synergy, as the company would become the largest financial holding company in Taiwan, own the largest bank, and also run the third largest life insurance company in Taiwan.