Hong Kong billionaire Michael Kadoorie is increasing his family’s stake in Hongkong and Shanghai Hotels, which operates the Peninsula hotel, by buying shares worth around $337 million from Seekers Partners and other undisclosed sellers.
According to a filing with the Hong Kong stock exchange, Kadoorie has agreed to buy 205.3 million shares at HK$12.80, or almost double Friday’s closing price of HK$6.65. The announcement made the company share price soar on Monday, when it closed at HK$7.95.
Completion of the deal is conditional upon the Kadoorie family obtaining a waiver from the Securities and Futures Commission from making a takeover offer for the rest of the company by March 31, unless extended by both parties.
The Kadoorie family has a combined shareholding of 989,347,304 shares, or 60% of the stake in the company. After the deal’s completion, the family will have a combined shareholding of 1,194,658,489 shares, or a 72.43% stake.
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Michael Kadoorie was No. 11 on the Hong Kong Rich List last year, with a net worth of $7 billion. Kadoorie is currently the chairman of the Hongkong and Shanghai Hotels, which operates the Peninsula hotel chain across the globe. It fully controls the property and brand in Hong Kong, Tokyo, New York, Chicago, and Bangkok, and has part ownership in Paris, Shanghai, Beijing, and Manila, among others.
Kadoorie also chairs CLP Holdings, the publicly traded power company that his family cofounded in 1901. CLP is one of the biggest power companies in the Asia-Pacific region with investments in Hong Kong, China, Australia, India, Southeast Asia and Taiwan.
The Hongkong and Shanghai Hotels is still affected by the Covid-19 pandemic. It recorded revenue of HK$1.26 billion for the six-months ended 30 June 2021, a 5% decrease over the same period the previous year according to the company’s interim report last August. The company’s flagship property that was built in 1928, the Peninsula Hotel Hong Kong, reported revenue of HK$306 million in the first six months of last year, an 8% increase compared to the same period the previous year.
Despite the uncertainty lingering because of the pandemic, according to a report released in October by real estate firm JLL, the growth momentum for investment in hotels in the Asia-Pacific region will continue this year with an estimate of a baseline forecast of $9 billion.