Chinese Estates, a key Evergrande backer, cuts its stake further
CHINESE Estates Holdings, a long-time supporter of China Evergrande Group, has further cut its stake in the embattled property developer. The Hong Kong firm, led by CEO Chan Hoi-wan, sold about 270 million Evergrande shares since its last disclosure on Oct 6, lowering its stake to 2.36 per cent as at last Friday (Nov19), according to a company filing late Tuesday.
It revised its expected loss if it got rid of all of its holding to HK$10.6 billion (S$1.9 billion) from HK$10.4 billion last month. Chinese Estates and Chan spent years helping Hui Ka Yan raise cash for his empire and at one point had an Evergrande stake of almost 9 per cent. But as the developer's woes worsened, Hui's backers began heading for the exit and started offloading their holdings in August. Since then, the Hong Kong firm offered to go private after its shares slumped as much as 51 per cent in about 7 months.
Solar Bright, a British Virgin Islands company ultimately owned by Chan, is making the offer to take Chinese Estates private. The company will let investors cast their vote at a meeting on Dec 17, and it expects a withdrawal from the Hong Kong stock exchange on Jan 13 if the proposal goes through, according to the filing.
Separately, Chinese Estates said it saw a HK$1.4 billion loss from offloading its notes in another cash-strapped developer, Kaisa Group Holdings. Kaisa's stock slumped 73 per cent this year before trading was halted. BLOOMBERG
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