Three firms seek $10b in placements

Business | Stella Zhai 5 Jun 2020

At least three companies are placing shares to raise nearly HK$10 billion in total for capital supplements, while Tencent's (0700) executive director and president Martin Lau Chi-ping offloaded his shares for a third time this year, cashing in HK$247 million after the stock rallied above HK$400.

China Vanke (2202) has placed 315.59 million new H-shares at HK$25 apiece to raised nearly HK$7.87 billion. The developer intends to use the net proceeds to replenish working capital and repay outstanding overseas debt, but will not use the fund to develop domestic residential properties.

Yongsheng Life (1995), a mainland property manager, and Minsheng Education (1569) are also seeking top-up share placements. This came after China Resources Gas (1193) and Greentown Service's (2869) recent share placements, which aim to raise nearly HK$6 billion in total.

In other news, mainland real estate operators overall have seen sales growth in May.

This comes as Nomura analysts expect annual net profit for mainland developers will fall 5 to 10 percent this year.

Country Garden's (2007) contracted sales rose 3.3 percent year-on-year to 56.11 billion yuan (HK$61.08 billion), and Shimao Property (0813) reported last-month contract sales were up by 37 percent from a year earlier to 22.02 billion yuan.

China Overseas Land & Investment (0688), however, saw contract sales fall 5.4 percent to 26.78 billion yuan in May.

Yuzhou Properties (1628) said sales in April and May both grew and contracted sales for the first five months amounted to 30.7 billion yuan - more than the total sales of the last first half-year and close to 95 percent of the sales target this year.

The company's senior vice president and chief financial officer, Chiu Yukang, said the group was treated unfairly by the S&P Global Ratings in a downgrading in April, and has withdrawn its cooperation with S&P.

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