News > International________ Holders OK HSBC-Household deal $13B merger will fulfill HSBC's goal of making a big move into the United States. March 28, 2003: 3:19 PM EST LONDON (Reuters) - The shareholders of both HSBC and Household International Friday approved the $13 billion takeover of Household, fulfilling a long-standing ambition for HSBC to make a major move into the United States. The all-share takeover of Household International Inc., which lends to people with patchy credit histories, significantly raises HSBC's profile in the world's biggest consumer market, but comes as the U.S. economy is sputtering. HSBC Holdings PLC, which announced earlier on Friday that regulators had cleared the deal, said 99.4 percent of its shareholders had backed the move at a specially convened meeting. Prospect Heights, Ill.-based Household said its shareholders also approved and that the deal is on target to close by the end of March. HSBC, based in London and with operations around the world, wanted the move to diversify earnings amid an economic downturn in its key historic market of Hong Kong and tough competition in Britain. The acquisition of Household will put it in 46 U.S. states, give it 50 million new customers and another $101 billion in assets and make its credit card arm a global powerhouse. But the deal has also raised questions among investors given the shaky U.S. economy and also among some critics who have for several years attacked Household for abusive loan practices. In October, Household agreed to pay $484 million in a record multistate U.S. settlement of charges that it targeted low income borrowers with high interest rate loans. And last week, Household said the Securities and Exchange Commission found it had violated federal securities laws for how it discloses information about its accounts. It did not admit or deny the findings. It said it would make changes, but would not have to pay any fines as a result of the matter or restate any past results. Earlier this month when reporting a 21 percent leap in annual profit to $9.6 billion, HSBC Chairman John Bond said Household would help HSBC compete with U.S. rivals such as Citigroup Inc., the biggest consumer lender in the United States. HSBC shares, which have outperformed the European banking sector by 13 percent over the past 12 months, closed down 1 percent in London. Household (HI: down $0.24 to $28.01, Research, Estimates) shares edged lower on the New York Stock Exchange. _ link: http://money.cnn.com/2003/03/28/news/international/hsbc_household.reut/index.htm
Printable Version Newsroom Latest News News Archive 2003 News Archive 2002 News Archive 2001 In the News Speeches Household acquisition Home _ HSBC completes the acquisition of Household 28_March 2003 HSBC Holdings plc (â??HSBCâ?) today announced the completion of its acquisition of Household International, Inc. (â??Householdâ?) by way of merger with H2 Acquisition Corporation (â??H2â?), a wholly owned subsidiary of HSBC._ H2 will be renamed â??Household International, Inc.â? All necessary regulatory and other consents and approvals were obtained to permit completion in accordance with the merger agreement entered into on 14 November 2002._ A certificate of merger was filed earlier today with the Secretary of State of the State of Delaware declaring the merger effective as of 10.02 p.m. (London time) today. In connection with the acquisition, HSBC has allotted 1,273,297,057 new ordinary shares of US$0.50 each (the â??New Sharesâ?)._ Application for listing has been approved by the UK Listing Authority and trading on the London Stock Exchange of the New Shares is expected to commence on Monday, 31 March 2003 at 8.00 a.m._ Trading of the New Shares on Euronext will commence on 31 March 2003 at 9.00 a.m. (Paris time) and trading of the New Shares on the Hong Kong Stock Exchange will commence on 1 April 2003 at 9.30 a.m. (Hong Kong time). Trading of American Depositary Shares representing the New Shares on the New York Stock Exchange will commence on 31 March 2003 at 9.00 a.m. (New York time)._ Applications for listing of a further 127,329,705 ordinary shares of US$0.50 each, which may be issued in future in connection with obligations arising from the acquisition of Household, have been approved by the UK Listing Authority (a block listing) and by the Hong Kong Stock Exchange. The last day of trading on the New York Stock Exchange in Household common stock was 28 March 2003. HSBCâ??s acquisition of Household contributes to a major strategic objective of maintaining a balanced worldwide portfolio._ Approximately 30 per cent of HSBCâ??s assets are now in the Americas, 30 per cent in Asia and the Middle East and 40 per cent in Europe._ HSBCâ??s broad spread of businesses, balanced between OECD countries and developing markets, is further diversified through the addition of Household's consumer lending portfolios._ Personal financial services is now HSBCâ??s largest line of business. William F Aldinger, Chairman and Chief Executive of Household, will continue to lead Household's businesses and will assume overall responsibility for the HSBC Group's North American operations._ He will become Chairman and Chief Executive Officer of HSBC North America Inc. later this year.__ Mr Aldinger will also be appointed a director of HSBC Holdings plc. Sir John Bond, Group Chairman of HSBC, said, â??Household is a company with a 125-year history, which brings over 50 million customers in the US to HSBC; its delivery channels include over 1,300 branches in 45 states, relationships with over 70 retail merchants and a national network of auto-dealerships together with multiple web-based services._ Our combined credit card businesses will be in the worldâ??s top ten._ Household is a very significant addition to HSBC and we look forward to delivering value from the opportunities this brings.â? â??We are delighted to be part of the HSBC Group now and we are excited about the opportunities that this brings,â? said William F. Aldinger, Chairman and CEO of Household._ â??The combination of Household and HSBC means that we can now provide our respective customer bases with a full range of financial services and allows us to continue to serve them, with products that best meet their needs as their financial circumstances evolve.â? Related links Household acquisition page _ Latest News HSBC completes the acquisition of Household HSBC shareholders approve acquisition of Household HSBC receives regulatory approvals for Household acquisition HSBCâ??s EGM - Chairmanâ??s speech Household acquisition: Second Supplementary Listing Particulars HSBC creates biggest prize in US & European golf Household International HSBC restructures its European private equity business Household acquisition: Supplementary Listing Particulars HSBC Holdings plc 2002 Annual Results link: http://www.hsbc.com/code/tools/site...&bt=&pId=3411eb50-f1e6-11d6-b05a-080020c629df
