China Vanke Co. (02202.HK, 000002.SZ) said on Thursday that its second largest shareholder, China Resources Group, will sell its entire 15.31 percent stake to Shenzhen Metro Group.
Under the deal, Vanke will see 1.69 billion A-shares listed in Shenzhen get transferred to Shenzhen Metro at 22 yuan a share, the property developer said in a stock-exchange filing, Reuters reports.
The transaction, which will be worth 37.2 billion yuan (US$5.40 billion) in total, comes as Vanke has been embroiled in a high-profile corporate power tussle for over a year.
The developer has been trying to fend off its biggest shareholder, financial conglomerate Baoneng which has built up a 25 percent holding and has sought to oust management.
Vanke had previously tried to make Shenzhen Metro its No. 1 shareholder through an asset swap worth US$6.9 billion, but had to call off the deal as it could not get major shareholders to agree.
China Resources had opposed the Shenzhen Metro deal but has said it was not working with Baoneng to replace Vanke’s board.
While Baoneng has sought to oust management, it has said little about its intentions.
Recent proposed ownership limits at Chinese insurance companies could, however, effectively stop it from using its insurance unit to further fund the acquisition of more shares in Vanke, the report noted.
Baoneng’s shares in Vanke will come out of a lock-up period on Jan. 17.
Complicating matters, China Evergrande Group (03333.HK) has built up a stake of 14.07 percent in Vanke in the latter half of 2016 but has since said it is not interested in seeking control of the rival.
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