1st LD: Li Ka-shing's two major companies announce restructure plan

Hong Kong's leading multinational corporations Cheung Kong Holdings and Hutchison Whampoa on Friday announced a merge and reorganization plan to restructure their operations into two new companies respectively specializing in real estate business and all other non-real estate businesses.

The two super international conglomerates are the main pillars of the family businesses owned by Hong Kong's wealthiest man Li Ka- shing.

The two new companies, CK Hutchison Holdings Limited (CKH Holdings) and Cheung Kong Property Holdings Limited (CK Property), will be listed on the Hong Kong bourse.

CKH Holdings will hold all of the non-property businesses of the Cheung Kong Group and Hutchison Whampoa, including ports and related services, telecommunications, retail, infrastructure, energy and movable assets leasing operations (aircraft leasing).

CK Property will combine the property businesses of the Cheung Kong Group and Hutchison Whampoa in Hong Kong, the Chinese mainland and overseas.

Commenting on the transaction, Li said it is a watershed event in the Group's history. "It is transformational from the point of view of shareholder value. Cheung Kong and Hutchison have grown substantially in size and scale over the past decade."

Li said the reorganization proposed on Friday will place the companies in an even stronger position for future growth and development.

"This transaction is expected to create significant value for shareholders through the elimination of the holding company discount, which will be shared by Cheung Kong and Hutchison shareholders," Li said.

"The distinct business profiles of CKH Holdings and CK Property will enable investors to better value the underlying businesses of the Groups and may lead to further value enhancement in the future, " Li added. Endi