CITIC Limited
| Company type | Public |
|---|---|
| Industry | Conglomerate |
| Headquarters | Hong Kong , Hong Kong |
Key people | Chang Zhenming (Chairman) |
| Products | Financial services, resource and energy sectors, manufacturing, engineering contracting, property development |
| Owner | CITIC Group (58%) |
| Parent | CITIC Group |
CITIC Limited () is a diversified conglomerate headquartered in Hong Kong, publicly traded on the Main Board of the Hong Kong Stock Exchange and included in the Hang Seng Index. The Chinese government-owned CITIC Group possesses a 58% ownership interest. CITIC Limited's core operations span financial services, resource and energy sectors, manufacturing, engineering contracting, and property development.
2008 Foreign exchange losses controversy
In October 2008, chairman Larry Yung disclosed that CITIC Limited suffered losses amounting to HK$15 billion (US$2 billion) due to "unauthorized trading activities." These transactions involved hedge contracts valued at A$9 billion against the Australian dollar, designed to hedge a planned A$1.6 billion acquisition and capital investments. The losses occurred following a sharp depreciation of the Australian dollar relative to the US dollar. Support was assured by the parent entity, CITIC Group.
The board became aware of the situation only on 7 September 2008; however, public disclosure was postponed until after trading in the company's shares was halted on 20 October. This postponement led to regulatory investigations and parliamentary inquiries into disclosure standards. When trading resumed, share prices had declined by roughly 75%.
As a consequence of the incident, two senior executives resigned. Frances Yung, daughter of Chairman Yung, faced demotion due to her role in the matter. Managing director Henry Fan temporarily relinquished his public appointments, including his positions on Hong Kong’s Executive Council and as chairman of the Mandatory Provident Fund Schemes Authority.
In April 2009, trading was suspended once more amid a Hong Kong Police investigation into potential false statements concerning foreign exchange contracts and corporate disclosures between 2007 and 2009. On 8 April, Larry Yung and Henry Fan stepped down; their roles were assumed by Chang Zhenming, who also chairs CITIC Group.
Recent history
CITIC Pacific acquired the majority of assets from its parent company and issued new shares to it, effectively listing most of CITIC Group's holdings on the stock market while CITIC Group maintained its interest in CITIC Guoan Group.
In 2014, the company changed its name from CITIC Pacific Limited () to CITIC Limited ().
On 20 January 2015, Japanese trading giant Itochu together with its Thai partner Charoen Pokphand announced a joint investment totaling about HK$80 billion (US$10.4 billion) in CITIC Limited—marking the largest investment ever made by a Japanese general trading company, the most significant acquisition by a Japanese firm in China, and the biggest foreign capital injection into a Chinese state-owned enterprise.
This arrangement involved Chia Tai Bright Investment—a joint venture equally owned by Itochu and Charoen Pokphand—purchasing a 10% equity stake in CITIC Limited from CITIC Group for HK$34.4 billion (US$4.54 billion), alongside subscribing to new convertible preferred shares worth HK$45.9 billion (US$5.9 billion). Prior to this transaction, CITIC Group held 77.90%, while the National Social Security Fund owned 5%, leaving only 17.1% available for public trading as of December 2014. At that point, the company also had perpetual capital securities amounting to HK$13.834 billion.
On 9 January 2017, a consortium comprising CITIC Limited, private equity funds managed by CITIC Capital and The Carlyle Group, acquired an 80% interest in the franchise rights of McDonald's across Hong Kong and mainland China for up to US$2.08 billion. Through Fast Food Holdings (with ownership split approximately 61.54% to CITIC entities and 38.46% to Carlyle), CITIC Limited together with CITIC Capital held a combined majority stake of 52%, while Carlyle controlled 28%. McDonald's retained a minority stake of 20% via Golden Arches Investments Limited. By January 2020, CITIC began seeking investors interested in acquiring most of its shareholding in Fast Food Holdings.
Subsidiaries
- CITIC Trust (wholly owned)
- CITIC Pacific Limited (entirely owned)
- Tamar Alliance (fully controlled)
Equity investments
- Beijing Sinobo Guoan F.C. (holding of 36%)
- AsiaSat (37.22% stake through a joint venture)