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Bloomberg
Citic Securities Co. signed a preliminary agreement to buy smaller rival Guangzhou Securities, the latest in a series of acquisitions by China’s largest brokerage.
Citic Securities plans to fund the purchase by issuing shares to the current owners of Guangzhou Securities — Hong Kong-listed Yuexiu Financial Holdings Group and one of Yuexiu’s wholly-owned units, according to a filing to Shanghai stock exchange.
The acquisition is in line with Citic Securities’ strategy of expanding via asset purchases amid a market downturn, said Founder Securities Co. analyst Zuo Xinran. The latest acquisition will strengthen Citic Securities’ presence in southern China after its failed bid to buy a stake in GF Securities Co. in 2004. Shares of Chinese brokerages have plunged this year.