May 13, 2015 / 1:15 AM / 4 years ago

Hang Seng Bank to sell $2.7 billion stake in China's Industrial Bank

A man walks on footbridge outside Hang Seng Bank headquarters in Hong Kong March 27, 2013. REUTERS/Bobby Yip

HONG KONG (Reuters) - Hang Seng Bank Ltd (0011.HK), a unit of HSBC Holdings (HSBA.L), said it is selling a stake in China’s Industrial Bank Co Ltd (601166.SS) worth up to 16.8 billion yuan ($2.7 billion) to bolster its capital position and to fund expansion.

The sale of the up to 4.99 percent stake is the second chunk of Industrial Bank that the Hong Kong-based lender has put on the market this year, after it raised about $2 billion in February.

Hang Seng said in a statement late on Tuesday that it would retain 0.88 percent of the Chinese bank on completion of the deal.

A sharp rise in Hong Kong shares has encouraged some financial investors to cash out their holdings, resulting in a wave of block deals in Hong Kong over the past few weeks.

Hang Seng Bank, 62.14 percent-owned by HSBC (0005.HK), said it would sell 950.7 million shares of the Shanghai-listed lender at 17.68 yuan apiece, or a 5.96 percent discount to the previous close.

Goldman Sachs Gao Hua Securities Co Ltd and UBS

Securities Co Ltd are the joint placing agents, it added.

Reporting by Donny Kwok and Denny Thomas; Editing by Stephen Coates

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