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GIC plans to spend HK$1.16 billion (S$202 million) to increase its stake in China’s Franshion Properties from 3 percent to 6.5 percent, according to the Chinese developer’s filing to the Hong Kong bourse yesterday.
Franshion Properties aims to raise HK$4.37 billion (S$763.18 million) by offering 1.6 billion shares to investors like Singapore’s sovereign wealth fund at HK$2.73 (S$0.48) apiece, translating to a 9.9 percent discount from the last closing price of its stocks.
The company will use the proceeds from the placement for debt financing and potential investments.
After the transaction, the stake of Franshion Properties’ largest stockholder Sinochem Corp will be reduced from 64 percent to 54 percent, but it will remain as the biggest shareholder.
New China Life Insurance Co will emerge as the second largest with a stake of 9.5 percent, followed by GIC with an interest of 6.5 percent.
Notably, developers from China are tapping Hong Kong’s flourishing stock market to raise capital and pay off debt, given a rebound in the country’s property industry.
Nikki De Guzman, Editor at CommercialGuru, wrote this story. To contact her about this or other stories email nikki@propertyguru.com.sg
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