Bank of America raising stake in China

Bank of America plans to raise its stake in China Construction Bank to nearly 11 percent, by exercising an option it has to buy more common shares of the Beijing-based bank.

Bank of America first invested in the China bank in June 2005, when it bought a 9 percent stake in a $3 billion deal. Bank of America said it intends to purchase 6 billion more shares for nearly $1.9 billion, or 2.42 Hong Kong dollars a share, on or about June 5, which would raise its total stake to 25.1 billion shares, or 10.75 percent of China Construction Bank’s issued common shares.

The 6 billion new shares may not be sold until Aug. 29, 2011. Since 2005, the two banks have started nearly two dozen partnership projects.

(AP)