Slaughter and May is advising on the proposed privatisation of Beijing Capital Grand Limited by the way of a scheme of arrangement

Slaughter and May is advising China International Capital Corporation Hong Kong Securities Limited (CICC) as financial adviser to BECL Investment Holding Limited (BECL), an investment holding company that is indirectly wholly owned by Beijing Capital Group Co., Ltd. (Beijing Capital Group), in relation to the proposed privatisation of Beijing Capital Grand Limited (Capital Grand).
 
The proposal will be implemented by way of a scheme of arrangement pursuant to the Companies Act of the Cayman Islands (the Scheme) and involves a conditional cash offer for all of the outstanding perpetual convertible bond securities (Perpetual CB Securities) issued by Capital Grand (Perpetual CB Securities Offer). The Perpetual CB Securities Offer is conditional upon the Scheme becoming effective. The proposal was announced on 28 October 2024 and the scheme document has been despatched on 16 December 2024.
 
The consideration for the Scheme and the Perpetual CB Securities Offer will be paid in cash. The Scheme shareholders will receive a cancellation price of HK$0.85 per share, whereas the holders of Perpetual CB Securities would receive approximately HK$0.40 for every HK$1 face value of the Perpetual CB Securities. The maximum amount of cash consideration payable under the proposal is approximately HK$640.50 million (equivalent to approximately US$82 million). The Offeror intends to finance the cash requirement through internal financial resources and/or external financing.
 
Conditions of the proposal include (among other things) shareholders’ approval of the Scheme.
 
BECL is a Hong Kong incorporated investment holding company that holds approximately 60.38% of the issued share capital of Capital Grand. BECL is ultimately wholly owned by Beijing Capital Group.
 
Capital Grand is incorporated in the Cayman Islands with limited liability, whose shares have been listed on the Main Board of the Hong Kong Stock Exchange since 2 Apr 2012. Capital Grand is an investment holding company and the Group is principally engaged in commercial property development and management, with a focus on the development, operation and management of outlets-backed commercial integrated projects and non-outlets retail property projects in the PRC. Capital Grand is approximately 62.08% owned by the Offeror and its concert party, who are both ultimately wholly owned by Beijing Capital Group.
 
Lead partner Benita Yu comments: “We are delighted to be working with CICC and Beijing Capital Group again on this landmark transaction in the property sector. In 2021, we also advised CICC, financial advisers to Beijing Capital Group, on the successful privatisation by way of merger by absorption of Beijing Capital Land Ltd. We look forward to working with the clients for a smooth implementation of this deal.”