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<Research>Citi Sees CICC-CGS Merger as Feasible in LT
Recommend 9 Positive 13 Negative 7 |
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Earlier, Reuters cited sources as saying that CICC (03908.HK) would soon merge with CGS (06881.HK), and the transaction would create the third-largest broker with assets of US$193 billion upon completion, yet both brokers denied the merger news later. In Citi's opinion, the abovementioned merger plan is feasible in the long term. Assuming a share exchange ratio of 2.5:1, it is expected that CICC's A- and H-shares will have an upside potential of around 10% and 30% respectively. Citi was also optimistic about CGS, as the potential merger synergies could enhance the company's return on equity and CGS is anticipated to achieve stronger earnings performance than CICC in 4QFY24. AAStocks Financial News |
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