General Electric Co. (GE) is to pay US$100 million for a minority stake in Shenzhen-based lender Shenzhen Development Bank Co. (SZA: 000001). The deal is still pending approval by Chinese regulatory authorities and Shenzhen Development Bank's shareholders.
- GE's consumer finance unit will pay about 5.25 yuan a share for a 7 percent stake
- GE will be acquiring newly issued shares, diluting the stakes of existing shareholders.
- If the deal is approved by regulators and shareholders, GE will become the bank’s second-largest shareholder and second foreign investor.
- The holdings of Newbridge Capital Inc., a U.S. private equity firm and the bank's largest shareholder, will drop from 17.9 percent to just under 17 percent as a result of the deal.
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