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China Development Financial shares up on buy-in deal

TAIPEI, Taiwan -- Shares of China Development Financial Holding Corp. posted gains Tuesday after its announcement the previous day that it would acquire Cosmos Bank, a mid-sized bank in Taiwan, dealers said.

Investors hailed the acquisition deal, which is expected to help China Development Financial expand from investment banking into commercial banking, dealers said.

Shares of China Development Financial rose 1.61 percent to close at NT$8.84 (US$0.29), with 60.94 million shares changing hands, while the weighted index on the Taiwan Stock Exchange ended up 0.46 percent at 8,430.56.

However, shares of Cosmos Bank fell 4.18 percent to NT$14.90 as the acquisition price represented a more than 2-percent discount on the closing price Monday.

China Development Financial shares attracted strong buying soon after the local bourse opened, following the price discount in the acquisition deal, dealers said.

The momentum continued until the end of the session amid hopes that the commercial banking business will help boost the company's bottom line, dealers said.

On Monday, China Development Financial announced that it would acquire a 100-percent stake in Cosmos Bank for about NT$15.14 per share, a discount of about 2.6 percent on Cosmos Bank's closing price of NT$15.55.

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