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NY firm snaps ties with China builder

Thursday, November 08, 2012

Global private equity firm Warburg Pincus has ended its six-year relationship with Greentown China (3900) by selling its entire stake in the mainland developer.

The New York-based firm sold 45 million shares of Greentown last night at HK$9.16 to HK$9.36 each, a big discount of 8.03 percent to the closing price.

The sales will bring in HK$421.2 million for Warburg, which bought the shares before Greentown listed in 2006. SAR-based Wharf (0004) remains Greentown's second-largest shareholder, a position held since June.

It recently bought a Chengdu residential plot for 385 million yuan (HK$476.8 million). But home prices in lower-tier cities, including Chengdu, are expected to fall next year due to oversupply, warns real estate information website Soufun.

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The mainland also introduced preferential mortgage rates to help first-time homebuyers, but analysts fear this may encourage speculators.

GRACE CAO


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