China International Capital Corporation (CICC) merges with Dongxing Securities and Cinda Securities, creating a combined entity with over 900 billion yuan in assets. The merger involves issuing 3.1 billion new A shares at 36.91 yuan. CICC’s shares rose 3.7% to 36.18 yuan after trading resumed.

This merger will make CICC China’s fourth-largest investment bank with around 930 billion yuan in assets. It follows last year’s Guotai Junan Securities and Haitong Securities combination. The consolidations align with Beijing’s goal to build global financial champions and support technology self-reliance.

Under the merger agreement, each Dongxing A-share will convert into 0.4373 CICC shares, while each Cinda share will exchange for 0.5188 CICC shares. CICC, Dongxing, and Cinda are controlled by Central Huijin Investment, a unit of China’s sovereign wealth fund.

Cinda shareholders will receive 19.15 yuan per share, matching the 20-day average price. Dongxing shareholders will receive a 26% premium above the 20-day average price. Qualified CICC dissenting shareholders can sell their A shares at 34.80 yuan each and H shares at HK$18.86 each.

Central Huijin’s stake in CICC will drop from 40.11% to 24.44% after the merger. It pledged not to sell CICC shares for 36 months post-merger completion. CICC was founded in 1995 as a joint venture between China Construction Bank and Morgan Stanley, going public in Hong Kong in 2015 and Shanghai in 2020.

Read more at Yahoo Finance: Chinese brokerage CICC announces share swap merger details with Dongxing and Cinda