Vanke Makes Company's Largest-Ever Acquisition Worth USD8.1 Billion
Ma Yifei
DATE:  Jul 07 2017
/ SOURCE:  Yicai
Vanke Makes Company's Largest-Ever Acquisition Worth USD8.1 Billion Vanke Makes Company's Largest-Ever Acquisition Worth USD8.1 Billion

(Yicai Global) July 7 -- China Vanke Co. [HKG:2202] has won the bidding for some assets of Guangdong International Trust & Investment Co. in a public auction, making the company's largest-ever acquisition, it said in a filing to the Hong Kong Exchanges and Clearing Limited (HKEX) today. The buyer and the guarantor, both of which are indirect subsidiaries of Vanke, signed asset transfer agreement on the acquisition on July 4, with a consideration of CNY55.1 billion (USD8.1 billion), it disclosed. 

Vanke has made such a large-scale acquisition for the first time ever. Vanke had previously been adhering to the principle of "rejecting land hoarding, property hoarding or being king of land." It now seems to act in a different style after Wang Shi exited from the board of directors recently and Shenzhen Metro Group Co. became Vanke's largest shareholder after acquiring some shares. 

Public data shows by June 30, 2016, all equity of Guangdong Trust Real Estate Co was valued at CNY40.44 billion (USD5,9 million); that of subsidiary Guangzhou Branch Company is valued at CNY378 million (USD55 million); and the total value of creditors' rights comes to CNY3,857 million (USD567 million). 

The main assets held by Guangdong Trust Real Estate and its Guangzhou Branch Company include 16 plots in Guangzhou, including residential property, commercial property, hotels and offices, with a total floor area of around 2.11 million square meters, the filing shows.

Founded in July 1980, Guangdong International Trust & Investment was approved to be a non-banking financial institution by the People's Bank of China in 1983. The company subsequently could not pay off the huge stake of debts due at home and abroad and was trapped in severe insolvency due to the disordered operation and management. As shown by the final confirmation of the Higher People's Court of Guangdong Province, 200 creditors are involved in the bankruptcy case, with the total amount reaching CNY20.2 billion. The book assets of the company at the time of bankruptcy declaration totals CNY20.9 billion as revealed by the clearing and confirmation of the liquidation team. 

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Keywords:   Vanke,M&A,REAL ESTATE,Acquisition,Assets,Insolvency,Wang Shi,Guangdong International Trust