The Bank of East Asia (BEA) will carry out a comprehensive review of its portfolio of businesses and assets to ensure that they align with its strategic priorities and increase shareholder value in agreement with activist fund manager Elliot Management.  

“The review will focus on the identification of potential strategic transactions, which would enhance the value of BEA’s existing businesses and assets, and strategic alternatives for potentially non-core assets. ,” BEA announced on Wednesday.

BEA, which has engaged Goldman Sachs as its financial advisor in connection with the review, will announce an update on the status of the review by June 30 and will report any other material updates regarding the review in a timely fashion.   

“Assessing the strategic fit and value of constituent assets in the bank’s portfolio is an important initiative to improve our capital efficiency and drive shareholder value,” said Adrian and Brian Li, BEA’s co-chief executives.

Today’s announcement is made with the support of Elliott Management, which filed a suit in a Hong Kong court against the Li family-run BEA and some of its directors in 2016 over a share placement, accusing the bank of mismanagement. Elliot Management is a New York-based investment management firm, BEA shareholder, and one of the largest activist funds in the world.

“Elliott supports the announcement today by BEA that it will undertake a comprehensive strategic review,” said Jonathan Pollock, Elliot’s co-CEO and chief investment officer. “BEA has built a strong and valuable franchise in Hong Kong and the Mainland, and we believe this step will lead to significant value creation. We look forward to continuing a dialogue with management and the board about opportunities to increase shareholder value.” 

In conjunction with BEA’s review announcement, the bank said in a press release that Elliott would apply for a stay (a court-ordered “pause”) of the proceedings it had previously commenced against the bank and several of its former and serving directors.