Dow Jones Newswires: China Cinda shares surge after increasing stake in Ant unit
Shares of China Cinda Asset Management Co. 1359, +13.08% jumped on Tuesday, as investors welcomed the state-owned financial company’s big stake increase in a key unit of billionaire Jack Ma’s Ant Group Co.
The stock rose as much as 25% as the Hong Kong market resumed trading after the Christmas holiday. Shares were up 14% at 1.48 Hong Kong dollars by midday.
China Cinda on Friday said it will invest 6.0 billion yuan ($941.7 million) for an additional 20% stake in Chongqing Ant Consumer Finance Co., the consumer-finance arm of Ant and one of its most profitable businesses.
The state-owned asset manager will hold a 24% stake after the deal and become Chongqing Ant’s second-biggest shareholder.
Ant Group established the Chongqing unit earlier this year in a bid to overhaul its operations after Beijing halted its planned initial public offering.
The new subsidiary houses two of Ant’s most successful consumer credit services, Huabei and Jiebei, which count almost half a billion users and had been a key profitability engine for the company.