Citic Securities confirms bid for stake in rival

Citic Securities, one of only two listed brokers on the mainland, said its board had approved a plan to begin negotiating merger with rival GF Securities, the seventh-largest brokerage in an industry ravaged by shrinking stock valuations and sales margins. Analysts quoted in media reports said that, unlike previous broker mergers, this one made sense and appeared internally driven, even though the plan looked like a precision fit with Beijing's drive to encourage industry consolidation. Although company officials declined to get into specifics, Shenyin & Wanguo Securities had earlier reported that Citic Securities would pay RMB 520 million (US$62.65 million) for a 20% stake.