BEIJING, Jan. 4 (Xinhua) -- China Evergrande Group said it would sell 13.16 percent of the enlarged shares in a property subsidiary to eight investors for a total of 30 billion yuan ($4.32 billion), as part of its Shenzhen backdoor listing plan.
Evergrande said in October 2016 it planned to inject almost all of its property assets, held by the subsidiary, into Shenzhen Special Economic Zone Real Estate & Properties (Shenzhen Real Estate). It said the deal may include a strategic investment of up to 30 billion yuan.
A backdoor listing on the Chinese mainland would boost Evergrande's valuation, with the developer targeting a market value for the listed property vehicle of $33.7 billion, and make it easier for heavily indebted Evergrande to raise funds.
"The capital increase will serve to raise funds as well as to allow the group to maintain the public float of Shenzhen Real Estate upon completion of the proposed reorganization," Evergrande said in a statement on Monday.
Evergrande's shareholding in its property unit Hengda Real Estate Group Co would be diluted to 86.84 percent on completion of the capital injection, while the proceeds raised would be used to repay debt, for project development and for general working capital.
Three investors such as CITIC Juheng (Shenzhen) Investment Holdings LLP will each invest 5 billion yuan for a 2.19 percent stake in Hengda, while other five investors such as Shenzhen Zhongrong Dingxing Investment LLP will each invest 3 billion yuan for a 1.32 percent stake, according to a filing to the Hong Kong exchange. (Global Times)
A single purchase
