Harneys advised Aluminum Corporation of China Overseas Holdings Limited (“the Offeror”) in relation to its proposed privatisation of Chinalco Mining Corporation International (“CMC”), a Cayman Islands incorporated company listed on the Hong Kong Stock Exchange.
The privatisation was implemented by way of a members scheme of arrangement under section 86 of the Companies Law of the Cayman Islands and the proposed withdrawal of the listing of CMC’s shares on the Hong Kong Stock Exchange. The total value of CMC shares based on the cancellation price of HK$1.39 was HK$16,426,717,575 (US$2.1 billion) and the amount of cash required to implement the scheme was approximately HK$2,526,000,000 (US$326 million). Morgan Stanley acted as the financial adviser to the Offeror.
This deal is one of very few members schemes of arrangement involving a Hong Kong listed company. Harneys also advised and introduced a process by which the steps for a capital reduction were consolidated by dispensing with the “standard” two Court hearing requirement and replacing it with one Court hearing (and a conditional court order) to effect the capital reduction. This represented the second occasion under Cayman Islands law that Harneys has introduced this novel process (having first introduced it in the matter of Birmingham International, another Cayman Islands restructuring).
The Offeror is a Hong Kong-incorporated investment holding company which is wholly-owned by CMC, a state-owned enterprise administrated by the PRC’s Assets Supervision and Administration Commission of the State Council (SASAC). CMC principally engages in the mining, smelting and processing of non-ferrous metals and related trading, engineering and technological services, and is the core platform for the acquisition, investment, development and operation of non-ferrous and non-aluminium mineral resources and projects outside the PRC.
The Harneys team was led by Hong Kong-based partners Chai Ridgers and Joanne Verbiesen. Davis Polk & Wardwell acted as onshore counsel to the Offeror and Slaughter and May advised CMC.