2 Min Read
HONG KONG (Reuters) - Shenzhen Metro Group has acquired more shares in China Vanke (2202.HK) (000002.SZ) for 29.2 billion yuan ($4.3 billion), making it the largest shareholder in the developer, surpassing financial conglomerate Baoneng Group.
The latest move by the state-owned subway operator will affirm its control over Vanke, China's second largest property developer, and essentially ends the struggle for boardroom control.
Shenzhen Metro has acquired 1.55 billion A-shares in Vanke, equivalent to around a 14 percent stake, from another developer China Evergrande Group's (3333.HK) Hengda Real Estate and its subsidiaries at 18.80 yuan a share, Evergrande said in separate filings to the Shenzhen and Hong Kong stock exchanges.
That brings Shenzhen Metro's stake in Vanke to 29.38 percent, making it the biggest shareholder.
"The stake purchase will take advantage of Shenzhen Metro and Vanke's strengths in transportation and property development services," Shenzhen Metro said in a statement on its website.
Vanke has been in crisis since late 2015 as Baoneng built up a 25 percent stake and sought to oust management, but Shenzhen Metro, a key ally, became its largest shareholder in terms of voting rights in March after a proxy agreement with its third-biggest shareholder.
Vanke's A-shares listed in Shenzhen will resume trade on June 12 after a suspension since Wednesday. Its shares in Hong Kong have gained more than 4 percent since Wednesday, outpacing the broader Hang Seng Index .HSI.
The developer still has to hold a board meeting to elect new members, as the term of the current ones has officially expired in late March.
Reporting by Lee Chyen Yee in Singapore and Clare Jim in Hong Kong; editing by Adrian Croft