Merger & Acquisition

To ensure the completion of a deal, we advise clients through the various stages of the transaction process including:
  • strategic planning of acquisitions, takeovers, mergers or divestments;
  • structuring a transaction to serve our client's needs;
  • financial analysis;
  • financing methods;
  • business valuations;
  • deal price, terms and conditions;
  • co-ordination with other professionals and advisers;
    and deal management through to completion.

Notifiable Transactions

Transaction type Categorization 
(Transaction Size) 
Disclosure Requirements
@ Assets / Consideration / Profits / Revenue ratio Equity Capital ratio Announcement Circular Shareholders' Approval Inclusion of Pro forma financial statement
Share Transaction <5% Yes No No No
Discloseable Transaction 5% - 25% Yes Yes No No
Major Transaction - Disposal 25% - 75% NA Yes Yes Yes Yes
Major Transaction - Acquisition 25% - 100% Yes Yes Yes Yes
Very Substantial Disposal > 75% NA Yes Yes Yes Yes
Very Substantial Acquisition > 100% Yes Yes Yes Yes
Note: the above table is set out for reference only, please refer to the Listing Rules or consult Veda Capital for further details.

Reverse Takeover

When an acquisition or a series of acquisitions which, in the opinion of the Stock Exchange, constitutes, or is part of a transaction or arrangement which constitute, an attempt to achieve a listing of the assets to be acquired and a means to circumvent the requirements for new listings under the Listing Rules, the Stock Exchange will treat a company proposing a reverse takeover as if it were a new listing applicant, and the transaction must be made conditional upon approval by the shareholders of the company in general meeting.

Takeovers Code Implications

  • General Offers
  • Whitewash Waiver
  • Special Deal

Fund Raising


Placing of new shares or securities e.g. convertible bonds to potential investors and raise capital

Rights Issue

A rights issue is directly offered to all shareholders of record or through broker dealers of record and may be exercised in full or partially. Subscription rights may either be transferable, allowing the subscription-right-holder to sell them privately, on the open market or not at all. A right issuance to shareholders is generally issued as a tax-free dividend on a ratio basis. Because the company receives shareholders' money in exchange for shares, a rights issue is a source of capital.

Rights issues are more common as they are just as effective in raising money for the listed company, but more convenient for those shareholders who do not wish to increase their shareholding, as they can simply sell the rights.

Open Offer

An open offer is similar to a rights issue, in that shareholders are entitled to buy newly issued shares, normally at a price lower than the current market price, in proportion to their existing holdings. Unlike a rights issue, an open offer does not allow shareholders to sell the right to subscribe to shares X the shareholders have an entitlement rather than a tradeable right to subscribe to new shares.

Any entitlement that is not taken up is simply allowed to lapse, or the shares are sold to another party with no compensation to the original shareholder for the loss in value of their holding that results from the dilution the new issue causes.

Corporate Consultancy

Due Diligence Review

Veda Capital assists the purchaser, investor and/or lender in assessing a target or business by investigating and inquiring into relevant events and conditions. Due diligence review helps identify potential issues and risks that might require renegotiation of the deal structure or terms of a sale and purchase agreement. It provides independent assessment on the business and value of the target, which is a critical reference to the management when making an investment decision in a transaction.

Vendor due diligence is equally important for the estimation of a fair sale price and identification of potential risks in an early stage so that necessary actions could be taken by the vendor promptly. It also addresses major concerns to the vendor before purchaser is involved and as a result reassures prospective purchaser.

A due diligence review includes investigations in:
  • accuracy of the forecasts and projections including assumptions underlying the projections
  • potential risks, warranties and indemnities to be secured;
  • future cash flows of the business and its funding requirements (e.g. working capital sufficiency);
  • production facilities and operating procedures;
  • possible synergies; and
  • analysis and commentary on historical financial information.

Corporate Restructuring

Veda Capital provides relative advice to client companies to turn around its underperformed business by going through financial change. The aim is to enhance its business value that can provide significant improvements to the balance sheet, profit & loss and cash flow of the business.

Experience of Veda Capital includes:
  • Provide restructuring plans for the purpose of raising capital;
  • Corporate accounts review to identify any financial deficiencies and implement changes to improve on working capital cycle and profitability;
  • Reorganizing the corporate structure for the preparation of public listing; and;
  • Recommendations on operational restructure that can help deliver profit & loss impact and cash generation opportunities.

Capital Reorganization

Capital reorganization refers to:
  • Changes in the group structure e.g. by introducing a new subsidiary or holding company;
  • Capital reduction to increase capital reserves;
  • [Listed company repurchasing its own shares from the market;]
  • Share consolidation / subdivision, which resulted in changes in the board lot size and par value of the shares;
Capital reorganization may require shareholders approval and/or court approval. It may also be appropriate for the listed company to appoint a broker as its agent to match the sales and purchases of odd lots (if applicable) or for the major shareholder itself or by its agent to stand in the market to buy or sell odd lot securities. The particular circumstances of the listed company may dictate the method by which odd lot holders are to be accommodated and listed companies are urged to consult the Stock Exchange at the earliest opportunity to agree the appropriate trading method.

Prolonged Suspension

Resumption Proposal

Prolong suspension in trading of shares may be caused by, (i) failure to maintain sufficient level of operations to warrant the continued listing status of the listed company; (ii) failure to assess the financial position of the listed company possibly due to qualified audit opinion where the auditor is unable to express an opinion on whether the listed company has been able to maintain proper books and records and resulting in delay in release of financial information; and/or (iii) the need to address governance related concerns. Continuation of suspension for a prolonged period without taking adequate action to obtain restoration of listing may lead to the cancellation of listing by the Stock Exchange.

Veda Capital assists these companies in the preparation of a resumption proposal with the following subject to different cases:
  • involving a white knight acquiring the listed company's control by subscribing a substantial amount of new securities for cash consideration, and reactivating the company by starting an operating business;
  • seek for potential investor and carry out fund raising activities;
  • seek for vendor with operating business to be injected into the listed company to restore its level of operations and enlarge its asset base; and
  • arrange reviews of systems and controls of the listed company and obtain an independent confirmation that the directors have established procedures which provide a reasonable basis for them to make proper judgments with respect to the company's continuing obligations under the Listing Rules;

Veda Capital



  • Tel: (852) 2111 1698
    Fax: (852) 2295 3068

Copyright © Veda 2021, All rights reserved.