Li Ka-shings CK Asset gets shareholder approval for US$619 million takeover of UKs Civitas Soc

Hong Kong’s CK Asset Holdings has received shareholder approval for its bid to take over a government-funded UK social housing company, according to a statement filed with the Hong Kong stock exchange on Friday.

The flagship property developer of billionaire Li Ka-shing and his family said 64 per cent of the shareholders of Civitas Social Housing had approved its offer to buy the company for about £485 million (US$618.7 million).

Although CK Asset had initially predicated its buyout of Civitas on the condition that 75 per cent of the shareholders were willing to sell, that requirement has now been waived, according to Michelle Li, manager – corporate business development at CK Asset, in a separate statement sent to the media.

“We are delighted to have received shareholder acceptance of over 64 per cent of Civitas Social Housing’s issued shares,” Li said. “Encouraged by this result, we have decided to waive down the 75 per cent shareholding condition for the transaction to a level of more than 50 per cent.

“We will keep the offer open for a while longer and in the meantime, proceed to finalise the administration procedures for the financial closing.”

The final date of the extended offer has yet to be determined, CK Asset told the exchange.

Should CK Asset obtain at least 75 per cent of the voting rights, it will seek the delisting of Civitas from the London Stock Exchange. A 90 per cent approval from shareholders, meanwhile, would allow it to exercise its right to a compulsory acquisition of the remaining shares of Civitas.

Civitas has been on CK Asset’s radar owing to its financial and social value, said Yue Seng Chiu, head of special projects for the Hong Kong-based firm.

“Our success with this general offer enables us to make further inroads into the sector as well as enrich our global real estate portfolio with another asset which features steady income and stable returns,” said Yue

Civitas is a real estate investment trust (Reit) that owns supported housing and residential care houses for vulnerable adults age 18 to 65 with long-term learning disabilities or mental health issues. The accommodation is designed to give them the best quality of life possible within a community, while delivering significant cost savings to the country.

The UK government provides all the funding for the costs.

Civitas Investment Management, which is an affiliate of CK Asset, has acted as investment adviser to the Reit since its initial public offering in 2016.

CK Asset’s all-cash offer for the trust on May 9 at 80 pence per share was a 44.4 per cent premium to the closing price of 55.40 pence on May 5.

Civitas shares were trading higher in London on Friday at 80.20 pence a share, up from their previous close of 79.50 apiece. CK Asset Holdings’ shares meanwhile closed 2.16 per cent lower at HK$42.95 (US$5.49).

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