China Overseas Land & Investment Ltd. (00688.HK) will purchase properties from China State Construction Engineering Corp., its parent company, for a consideration of 1.82 billion yuan (US$293.28 million) and 31.99 billion yuan of shareholder loans through a rights issue, the Hong Kong Economic Journal reported Wednesday.
The assets include three portfolios in London and 27 premises across mainland cities like Beijing, Shanghai, Chengdu, Xi’an, Changsha and Urumqi, the company said in a stock exchange filing.
The company will issue 1.69 billion new shares, or 17.1 percent of the enlarged share capital, to the parent company at HK$25.38 apiece for HK$42.81 billion, equivalent to 33.82 billion yuan, subject to shareholder approval.
The parent’s stake in the company will increase to 61.18 percent from 53.18 percent.
The assets occupy a combined floor area of 37.4 million square meters. The deal will be completed through the acquisition of a sister company.
Analysts said the newly acquired properties might not yield much for China Overseas Land, considering that the sister company incurred losses of 490 million yuan last year and 1.38 billion in 2013.
This article appeared in the Hong Kong Economic Journal on March 25.
Translation by Vey Wong
[Chinese version 中文版]
– Contact us at [email protected]