(Yicai Global) July 31 -- Trading in the shares of Haier Smart Home, a Chinese home fridge and freezer maker, will not resume until Aug. 3 as it moves forward with the potential privatization of Haier Electronics Group.
Haier Smart Home has not committed to taking private the washing machine and water heater maker and has given no further details as to its share conversion ratio and timetable, it said in a statement yesterday.
Haier Smart Home has issued updates on the progress of its plan several times this year. The firm has been exploring the prospective delisting and has consulted relevant agencies on the transaction, it said in a July 16 statement, but has not submitted a formal blueprint to Haier Electronics and so significant uncertainties remain.
The shares of Haier Smart Home [SHA:600690] and Haier Electronics [HKG:1169], which is also part of Qingdao-based Haier Group, stopped trading yesterday.
Haier Smart Home owns 57 percent of Haier Electronics and both firms do many deals together and their management overlaps. Speculation is rife that they will merge after the privatization to enhance their managerial and operational efficiency and better equip them to go toe-to-toe with China’s two other big appliance makers Midea Group and Gree Electric Appliances.
Their rivals’ market caps far outstrip their own, and the privatization and merger may also serve to redress this issue.
Haier Smart Home rose by the 10 percent bourse-imposed ceiling on July 29 in advance of a statement it issued later that day detailing its scheme to sell 54.5 percent of Haier Cosmoplat IoT Ecosystem Technology to Qingdao Haier Ecological Investment for CNY4.1 billion (USD580.5 million).
Editor: Ben Armour