Vendor takes China Real Estate Grp to court over aborted subsidiary consolidation

CATALIST-LISTED China Real Estate Grp has been taken to court by a would-be seller over aborted plans to consolidate its stake in a Chinese real estate developer, its board disclosed in a bourse filing on Monday night.

The vendor, a unit of China Real Estate Group Union Investment Co, applied to a court in Beijing to make China Real Estate Grp, which used to trade as Asia-Pacific Strategic Investments, go through with the 9.8 million yuan (S$1.98 million) planned sale.

This is even as China Real Estate Grp maintained that the sale-and-purchase agreement - over a 28 per cent stake in Zhongfang Lianhe Grand Canal Cultural Tourism Group Co - was terminated in April, after conditions precedent were not met.

The vendor is also seeking a late-payment penalty of more than 1.93 million yuan, as well as payment of its cost of action on an indemnity basis.

China Real Estate Grp is getting legal advice from counsel Shanghai Hiways Law Firm, said the board, adding that it "is of the view that the vendor's claim is without basis".

It told shareholders the company will update them when there are further developments.

Shares closed flat at 0.1 Singapore cent on Monday, before the latest update.