Property developer Chun Wo Development Holdings Ltd. (0711.HK), which was in the news recently for scrapping scholarship programs at four local universities following the Occupy student protests, has announced that its major shareholder has agreed to sell its controlling stake in the company.
China New Way Investment Ltd. has agreed to acquire 510 million shares of Chun Wo for a total of HK$560 million, equivalent to HK$1.099 per share, according to a stock-exchange filing Monday. The shares represent 46.70 percent of the issued share capital of the company.
At the same time, Chun Wo issued 100 million new shares and convertible bonds to China New Way Investment.
The share sale and issuance together represent 51.18 percent of the issued share capital, so China New Way Investment will be required to make an unconditional mandatory cash general offer to acquire all the remaining shares, the filing said.
Following the latest transactions, the Pang family and its related parties still own 10.39 percent of Chun Wo.
The developer’s shares soared 15.8 percent on Tuesday to HK$1.17 after resuming trade following the announcement.
Earlier this month, Chun Wo said it was withdrawing student scholarships as it was not happy with the stance of universities and their leaders toward the Occupy protest movement.
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