Hubei State-owned Assets is set to become the largest shareholder of Changjiang Securities (000783.SZ).

On the evening of March 29th, Changjiang Securities announced that Hubei State-owned Assets' subsidiary, Changjiang Industrial Investment Group Co., Ltd. (hereinafter referred to as "Changjiang Industrial Group"), intends to acquire 15.6% of Changjiang Securities' shares held by Hubei Energy (000883.SZ) and Three Gorges Capital. On the same day, Changjiang Industrial Group signed a concerted action agreement with some shareholders of Changjiang Securities. After this change in equity, Hubei State-owned Assets will become the largest shareholder of Changjiang Securities.

According to the announcement, Changjiang Industrial Group plans to acquire 530 million shares and 333 million shares held by Hubei Energy and Three Gorges Capital, respectively, accounting for 9.58% and 6.02% of the total shares of Changjiang Securities, through an agreement transfer at a price of 8.20 yuan per share. This transfer price is nearly 60% higher than the closing price of Changjiang Securities on March 29th, which was 5.13 yuan per share.

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Changjiang Industrial Group will pay approximately 4.343 billion yuan to Hubei Energy for the equity transfer transaction and 2.73 billion yuan to Three Gorges Capital, with a total transaction amount of about 7.073 billion yuan. After this transaction, Hubei Energy and Three Gorges Capital will no longer hold shares in Changjiang Securities.

On the evening of the same day, Hubei Energy also announced that this transaction is aimed at optimizing the industrial layout, focusing on the main business, and enhancing the company's core competitiveness. On March 29th, the company held a board meeting to review and pass the "Proposal on the Agreement Transfer of Shares of Changjiang Securities Co., Ltd." This matter still requires approval from the company's shareholders' meeting and also needs approval from regulatory authorities such as the State-owned Assets Supervision and Administration Commission of the State Council and the China Securities Regulatory Commission.

In 2005, Hubei Energy was established by the merger of the former Hubei Qingjiang Hydropower Investment Company and the Hubei Electric Power Development Company, inheriting the shares of Changjiang Securities held by the former Hubei Qingjiang Hydropower Investment Company. Subsequently, it increased its holdings in Changjiang Securities through acquisitions, participation in rights issues, and secondary market increases. As of now, the book value of the shares held by Hubei Energy in Changjiang Securities is 3.166 billion yuan (unaudited).

Both Hubei Energy and Three Gorges Capital's controlling shareholders are China Three Gorges Corporation, and they are acting in concert. It is understood that as a central enterprise in the energy sector directly under the State Council, Three Gorges Group's divestment of Changjiang Securities shares is to implement the strategic deployment of the State-owned Assets Supervision and Administration Commission of the State Council to focus on the main business and develop the real economy.

According to the announcement, Changjiang Industrial Group currently holds 100 million shares of Changjiang Securities, accounting for 1.81%. After acquiring the 15.6% shares held by Hubei Energy and Three Gorges Capital, Changjiang Industrial Group will hold 963 million shares of Changjiang Securities, with a shareholding ratio of 17.41%.

At the same time, Changjiang Industrial Group has signed "Concerted Action Agreements" with Changjiang Securities shareholders Wuhan Urban Construction Group Co., Ltd., Hubei Hongtai Group Co., Ltd., Hubei E-Travel Investment Venture Capital Co., Ltd., Hubei Small and Medium Enterprise Financial Service Center Co., Ltd., and Hubei Daily Media Group Co., Ltd., respectively.

The concerted action persons of Changjiang Industrial Group hold a total of 598 million shares of Changjiang Securities, accounting for 10.82% of the total shares of Changjiang Securities. That is to say, Changjiang Industrial Group and its concerted action persons will collectively control 1.561 billion shares of Changjiang Securities voting rights, accounting for 28.22% of the total shares of Changjiang Securities. After the completion of this equity change, Changjiang Industrial Group will become the largest shareholder of Changjiang Securities.It is understood that the Yangtze River Industry Group is a state-owned enterprise in Hubei Province, focusing on the national strategy and the construction of modern industrial clusters in Hubei Province. It performs the functions of a provincial strategic emerging industry investment and operation entity and a provincial industrial investment fund investment management entity. It is based in Hubei to promote the green development of the Yangtze River Economic Belt and to enhance the energy level and scale of Hubei's industrial development.

The aforementioned equity changes still require the approval of the competent state-owned asset supervision and management authorities of the relevant parties, the approval of the State Administration for Market Regulation for the concentration of operators (if required), the approval of the China Securities Regulatory Commission for the change of the main shareholder of Changjiang Securities, the confirmation letter issued by the Shenzhen Stock Exchange for this share transfer, and the completion of share registration and transfer procedures at the Shenzhen Branch of China Securities Depository and Clearing Corporation.

Some industry insiders have pointed out that this transfer reflects the recognition of the intrinsic value of Changjiang Securities by Hubei's state-owned capital and confidence in the company's future development prospects.

Changjiang Securities, formerly known as Hubei Securities, was established in 1991 and listed on the Shenzhen Stock Exchange in 2007, becoming the sixth listed securities firm in China. After 33 years of development, Changjiang Securities has become a comprehensive service securities firm covering securities, funds, futures, asset management, private equity funds, alternative investments, and cross-border business.

The recent 2023 performance express report released by Changjiang Securities shows that in 2023, Changjiang Securities achieved a total operating income of 6.896 billion yuan, a year-on-year increase of 8.23%; the net profit attributable to the shareholders of the listed company was 1.548 billion yuan, a year-on-year increase of 2.58%. As of the end of 2023, Changjiang Securities' total assets were 170.729 billion yuan, and the equity attributable to the shareholders of the listed company was 34.662 billion yuan, respectively increasing by 7.39% and 12.79% compared to the beginning of the year.