The deal is expected to bring stable earnings to Huarong and optimize its asset allocation, the distressed debt manager said in a filing to the Hong Kong stock exchange.
Huarong is buying the China Merchants Expressway stake from Zhongxin No.1, a fund linked to the state asset regulating authority in the southwestern Chinese municipality of Chongqing, according to the filing.
Huarong purchased the stake at 8.4 yuan per share, or 90.71% of the 9.26 yuan closing price on the last trading day before the deal was signed, according to the filing.
Huarong said last month it has agreed to buy a 5.01% stake in CITIC Ltd for HK$13.63 billion ($1.75 billion) from Chinese finance ministry-controlled CITIC Group, which also holds a 26.5% stake in Huarong.
Huarong also said it plans to change its name to China CITIC Financial Asset Management Co Ltd, in a bid to leverage the brand value of CITIC Group.
China Merchants Expressway, which runs toll road and transport technology businesses, reported a net profit of 5.25 billion yuan in 2022, compared with 5.54 billion yuan in 2021, Huarong's filing showed.
($1 = 7.2111 Chinese yuan renminbi)
($1 = 7.7949 Hong Kong dollars)
(Reporting by Roxanne Liu and Kane Wu; Editing by Susan Fenton)
