TVB jumps as chairman to quit, sell stake

Television Broadcasts (0511) gained the most in almost three years after it said chairman Charles Chan Kwok-keung will resign effective February 4 and sell all his shares in the company.

Chan has signed a conditional agreement to dispose of his shareholding interests in Young Lion Holdings, as part of a proposed reorganization of the ownership interests among the shareholders of Young Lion, TVB said in a statement yesterday.

Chan told TVB that he will commence his retirement thereafter.

A financier who joined TVB in 2011 and chairman since January 2015, Chan held a 6 percent stake in Young Lion, according to reports last month.

TVB chief executive Mark Lee Po-on stressed that Chan had no disagreement with Li Ruigang, TVB's vice-chairman and controlling shareholder.

Meanwhile, Thomas Hui To, the chief operating officer and an executive director of CMC and a non-executive director of Shaw Brothers (0953), is believed to succeed Chan. Hui was appointed as TVB's non-executive director in 2015 and was redesignated as an executive director in 2018. He held 0.46 percent of the company as of the end of last year.

Young Lion, founded by Chan, Taiwanese entrepreneur Cher Wang Xue-hong and a US fund, became a major shareholder of TVB in 2011 by acquiring 26 percent of TVB for HK$6.3 billion, or HK$55 per share but since then, Young Lion has lost 80 percent of the investment as of Tuesday's closing at HK$11.88.

Hong Kong's largest broadcaster has drawn investment from funds including London-based Silchester International Investors, which has boosted its stake to more than 20 percent and become the second-largest holder. A change in the ownership of Young Lion may signal the broadcaster seeks to attract more investors.

TVB stock declined about 12 percent in the past 12 months, compared with a 4.9 percent gain in the benchmark Hang Seng Index.

Shares of the company once surged by 8.1 percent yesterday, the most in almost three years, before paring the gain to 6.06 percent and closing at HK$12.60.