9:18 PM
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--Goldman raises $1 billion in sale of ICBC shares
--Sale one to two times oversubscribed
--Goldman's stake in ICBC falls below 1%
(Revises first paragraph, adds share price and details throughout)
By Prudence Ho, Yvonne Lee and Fiona Law
HONG KONG--Goldman Sachs Group Inc.'s ( GS ) $1 billion sale of shares in Industrial & Commercial Bank of China Ltd. (IDCBY) overnight was between one and two times oversubscribed, two people familiar with the deal said Tuesday.
In the biggest share sale in Asia this year, the Wall Street bank sold 1.35 billion shares of the Hong Kong-listed ICBC in a block trade at 5.77 Hong Kong dollars (74 U.S. cents) each, a 3% discount to their closing price Monday, two people with direct knowledge of the deal said.
Goldman's stake in ICBC, China's top bank by assets, has now fallen under 1%, according to calculations by The Wall Street Journal.
Volatility in ICBC's shares led Goldman to report a full-year net loss in Asia in 2011, its first since 2008. It wrote down the value of its investment in ICBC by US$1 billion in the third quarter of 2011 as shares in the Chinese bank tumbled, but recorded a US$99 million mark-to-market gain as the stock rallied in the third quarter last year.
At mid-day Tuesday, ICBC's Hong Kong-listed shares were down 2.4% at 5.81 Hong Kong dollars, while the benchmark Hang Seng Index was little changed. ICBC's Shanghai-listed shares were down 0.9% at 4.25 yuan, while the Shanghai Composite Index was flat.
Still, the ICBC investment has been lucrative for Goldman. Including Monday's block trade, Goldman has raised more than US$8.6 billion from selling ICBC shares.
Goldman first bought a 4.9% stake in ICBC for US$2.58 billion in April 2006, before the ICBC's Hong Kong listing.
Based on a Wall Street Journal calculation, Goldman now holds 2.95 billion shares in ICBC, around 3.4% of ICBC's Hong Kong-listed shares and 0.8% of its total share base.
Before this week's share sale, Goldman held 4.3 billion Hong Kong shares in ICBC, according to a filing to the Hong Kong stock exchange, representing less than 5% of the H shares and 1.24% of the total share base.
"We have no immediate plans to sell more shares in ICBC," Goldman spokesman Edward Naylor said.
The sale will help boost Goldman's capital ratio as tougher global capital requirements take effect. The Basel III capital-requirement rules, agreed to by the leaders of the Group of 20 leading international economies, make it more expensive to hold minority stakes in financial institutions.
Write to Prudence Ho at prudence.ho@wsj.com, Yvonne Lee at yvonne.lee@wsj.com and Fiona Law at fiona.law@wsj.com
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