Sogo operator Lifestyle in privatization push

Lifestyle (1212), the operator of Sogo, is proposing to privatize the company for HK$5 per share, or a 50 percent premium from its last trading price, in an offer worth of HK$1.88 billion.

Its share price was at HK$3.08 before trading was suspended after a jump of more than 10 percent.

Meanwhile, the share price of Lifestyle China (2136) also climbed sharply by 16.7 percent to HK$0.91 on August 5.

Its major shareholder, Thomas Lau Luen-hung has obtained a stake of about 74.97 percent in the company since April 2019 amid suspicions that he was planning a privatization.

Lau and the late New World boss Cheng Yu-tung worked together to list the company in 2004.

However, from 2014 to 2018, Lau and Cheng went their own separate ways, with Cheng's shares taken over by Qatar Investment Authority and Lau becoming the major shareholder.

The Qatar agency sold all its shares in March 2018, and Lau secretly bought them.

However, the 2019 social unrest and the pandemic that ensued the year after that worsened the retail market, causing the company's share price to fall sharply.

From a historical high of HK$14.28 in April 2019, the price had fallen nearly 80 percent by Friday.

So the cost of going private for Lau is much lower than it was a few years ago.

In 2021, his brother, Joseph Lau Luen-hung, and his spouse proposed to privatize China Estates (0127) at HK$4 per share but failed to secure shareholder approval.