(Yicai) Sept. 23 -- Shares of China Aoyuan Group skyrocketed after the property developer said Multi Gold Group, an investment firm from the United Arab Emirates, has become its new largest shareholder.

Aoyuan [HKG: 3883] was trading up 114.29 percent at 25 Hong Kong cents (3 US cents) as of 2 p.m. today, after earlier jumping as much as 148 percent.

Multi Gold agreed to purchase about 621.7 million Aoyuan shares from Ace Rise on September 20, the Guangzhou-based builder announced on the same day.

After the transfer, Multi Gold will hold a 16.5 percent stake in Aoyuan, while Ace Rise’s stake will fall to 13.3 percent. Aoyuan’s founder Guo Ziwen, who is also the owner of Ace Rise, will then hold a cumulative stake of 16.4 percent in Aoyuan.

As part of the strategic investment deal, Guo stepped down from all his key positions in Aoyuan. Moreover, Multi Gold’s Director Mohamed Obaid Ghulam Badakkan Alobeidli became the company’s new chairman and non-executive director. Alobeidli, 45, has over 20 years of experience in technology, real estate, and strategic consulting.

“Multi Gold is likely to develop a material strategic relationship with Aoyuan in connection with and related to its present or future business,” the Chinese firm noted. “Multi Gold has been identified as a strategic investor as its acquisition of the target shares and becoming a substantial shareholder represent a long-term strategic investment and demonstrate its confidence about the future of China.”

Founded in 1996, Aoyuan achieved sales of CNY133 billion (USD18.9 billion) in 2020. However, it defaulted on US dollar debts in early 2022. In March this year, it completed its offshore debt restructuring, managing to issue new financial tools to swap USD6.1 billion of offshore debts and reduce its liabilities by USD4.9 billion.

In the first half of the year, Aoyuan’s revenue fell 57 percent to CNY4.6 billion (USD652.6 million) from a year earlier. Meanwhile, the firm turned a net loss of CNY2.9 billion to a net profit of CNY22.3 billion (USD3.2 billion) in the period.

Multi Gold is a specialized investment firm based in the UAE. It focuses on sustainability and social responsibility projects in the Middle East and North Africa.

Editor: Futura Costaglione