HSBC has requested that the board of Hang Seng Bank submit a privatisation proposal to shareholders through a scheme of arrangement under Hong Kong's Companies Ordinance, according to a joint announcement on Thursday.

Under the proposal put forward by HSBC Asia Pacific, Hang Seng Bank shares would be cancelled in exchange for a cash payment of HK$155 per share, valuing the transaction at approximately HK$290.74 billion.

The offer is subject to adjustment for any dividends declared after the announcement date, excluding the 2025 third interim dividend.

Privatisation schemes are commonly used in Hong Kong to streamline corporate structures and reduce the costs associated with maintaining a public listing.

As a key subsidiary of HSBC, Hang Seng Bank plays a significant role in the region's banking sector, making the offer a pivotal move in further consolidating HSBC's regional presence and operations.

The offer price is final, HSBC said, adding that it does not reserve the right to revise it.

It added that Hang Seng Bank will retain its own governance, brand, distinct customer proposition and a branch network, and that HSBC will continue to support community projects of which Hang Seng Bank has been a supporter. (Reuters/ RTHK)