Ahead of next month’s quarterly earnings release, firms may be making one last push to fill the firm’s coffers with cash. Goldman Sachs Group Inc. (NYSE: GS) is planning to sell shares in the Industrial & Commercial Bank of China Ltd., seeking HK$15.92 billion ($2.05 billion).
In total, terms of the transaction show that Goldman is offering 2.75 billion shares at prices between HK$5.70 and HK$5.79 per share. This price reflects nearly a 4.5 percent discount from today’s closing price. Goldman will continue to own 10.4 billion shares, which comprises a 3.1 percent stake in the Beijing based ICBC. According to a person with knowledge of this transaction, the remaining position may be liquidated at any time.
In April of 2006, Goldman invested nearly $940 million and funds managed by the company paid around $1.65 billion for a stake in ICBC, a total investment of $2.59 billion by May 2006 according to regulatory filings.
During June 2009, Goldman disposed of $1.9 billion in shares of the Chinese bank, which was the maximum it was allowed to divest under their lockup agreement with ICBC. In Hong Kong, ICBC has had a tough year, seeing their shares slump 7.3 percent, while the Hang Seng Index actually grew 2.3 percent in the same period.
Goldman Sachs continues during a difficult transition period for the firm – as it struggles to cope with the new regulatory requirements in the US, and the impending loss of the majority of their prop trading, the firm will need to reshape itself quickly as it looks toward 2011.
