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China Merchants Property sells $870 mln of shares

Sun Nov 30, 2008 7:34pm EST

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SHANGHAI, Dec 1 (Reuters) - China Merchants Property Development Co (000024.SZ)(200024.SZ) said on Monday that it had sold out a 5.94 billion yuan ($870 million) offer of new shares, despite weakness in the country's stock and real estate markets.

The mid-sized property developer had offered 450 million yuan-denominated A shares at 13.20 yuan each to institutional and retail investors, saying it would use the money to buy six pieces of land and invest in 14 property projects.

The secondary market price of its shares tumbled last week to the offer price, causing some analysts to speculate that the offer might not sell out.

But the company's controlling shareholder, China Merchants Shekou Industrial Zone Co, and related parties bought 62 percent of the shares on offer, helping to ensure its success. As a result, their stake in the company rose to nearly 54 percent from 51 percent. ($1 = 6.83 yuan) (Reporting by Andrew Torchia; Editing by Anne Marie Roantree)



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