Public Bank Proposes HK$734 Million Privatization of Public Financial Holdings

KUALA LUMPUR: Public Bank Berhad (PBB) has proposed a significant move to privatize its 73.23%-owned subsidiary, Public Financial Holdings Ltd (PFHL), which is listed on the Hong Kong Stock Exchange. The bank aims to acquire the remaining 26.77% of PFHL shares at a cash offer of HK$2.50 (approximately RM1.29) per share, amounting to about HK$734.75 million (around RM378.6 million), according to a filing with Bursa Malaysia.

The proposed offer represents a 61.29% premium over PFHL's last traded price of HK$1.55 on August 19, the last trading day prior to the announcement. It also reflects premiums of 78.57% and 81.16% over PFHL's 30-day and 60-day average closing prices, respectively. However, this offer price is at a substantial 64.64% discount to PFHL's unaudited consolidated net asset value of approximately HK$7.08 per share as of June 30, 2026.

PBB stated that the privatization would simplify PFHL's ownership structure and enhance operational efficiency between PFHL and the banking group. The bank highlighted that the trading liquidity of PFHL shares has been relatively low, with an average daily trading volume representing only about 0.027% of the total issued PFHL shares over the past year, which could complicate any attempts by minority shareholders to liquidate their investments without impacting market prices.

“The proposals provide the scheme shareholders with an opportunity to realise their investment immediately at an attractive premium to the historical trading prices of the PFHL shares.”Public Bank Berhad, company announcement

PBB noted that the proposals provide the scheme shareholders with an opportunity to realise their investment immediately at an attractive premium to the historical trading prices of the PFHL shares. The bank further emphasized that taking PFHL private would eliminate the costs and administrative requirements associated with maintaining its listing, thereby allowing resources to be focused more directly on its core banking operations.

PFHL operates in various sectors including banking and financial services, stockbroking, and investment property leasing, with 29 branches in Hong Kong and one in China. The company has shown a positive financial trajectory, reporting a net profit of HK$25.19 million for the first half of 2026, a significant increase from HK$2.57 million in the same period of the previous year.

The proposed privatization is subject to approval from at least 75% of the votes cast by PFHL's disinterested shareholders at a court-convened meeting. The bank has indicated that the offer price will not be increased, setting a firm stance as it seeks to consolidate its holdings.