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* December sales down 44 pct, full-year sales down 35 pct
* Greentown adopts “light-asset” strategy
* Company to receive 1 bln yuan from Shanghai stake sale
By Alex Frew McMillan
HONG KONG, Jan 5 (Reuters) - Mainland real estate developer Greentown China Holdings Ltd saw sales plunge 44 percent year on year in December, a source close to the company said on Thursday, as Beijing’s efforts to curb property speculation bite.
Greentown, which has been trying to slash its debts and diversify away from capital-intensive property development, posted sales of 5.7 billion yuan ($905.54 million) in December, the source told Reuters.
For the full year, contracted sales hit 35.3 billion yuan, the source said. The company reported contracted sales of 54.1 billion in 2010, indicating 2011 sales fell 35 percent.
Greentown officials could not be immediately reached for comment.
Greentown shares tumbled 7.2 percent on Thursday, bucking a 0.5 percent rise in the Hang Seng Index. Greentown plunged 62.5 percent in 2011.
The drop in December sales follows dismal figures released on Wednesday by two major Chinese developers -- China Vanke Co Ltd , and Evergrande Real Estate Group Ltd .
Vanke’s sales fell 30 percent in December, while Evergrande’s sales slid 53 percent as developers across China feel the squeeze from tight financing and continuing property-sector curbs.
Although both China Vanke and Evergrande saw sales jump for the year, market watchers anticipate a tough year ahead for the mainland property industry. HSBC analysts predict that developers will slash prices early in 2012 to spur sales, suggesting a price war and tighter profit margins.
Greentown, which had a net gearing of 163 percent at the end of June, said it intended to alter its strategy this year after a disappointing 2011.
Chairman Song Weiping said on the company’s website on Dec. 30 that its core strategy in 2012 would be to “stretch ourselves to survive”. He admitted that the company had not anticipated how far-reaching the effects of Beijing’s austerity measures would be.
He added that Greentown would shift to a “light-asset” strategy. It would also focus on agency construction, building projects for other companies for a fee of about 7 percent of sales. The aim is to raise cash without the need for the company to inject its own capital into those projects.
Greentown has said it will sell assets to generate cash, and has entered a joint venture with sovereign wealth fund China Investment Corp and private equity firm Blackstone Group.
Analysts expect more Chinese property developers to sell off projects in 2012, with weaker companies likely to exit the business altogether.
According to mainland Chinese media, at least 16 listed Chinese companies that had real estate holdings but were not focused on property exited the property business in 2011, a reflection of the slowing market.
A private survey this week showed home prices in mainland China fell 0.3 percent in December, the fourth straight month of declines.
Greentown expects to realize 1 billion yuan in cash from the sale of its share of a development project on the Bund in Shanghai, the source said on Thursday.
Chinese conglomerate Fosun International Ltd has raised an objection to the sale, in which SOHO China Ltd is paying 4 billion yuan ($635 million) to buy a 50 percent stake in the site from Greentown and Shanghai Zendai Property Ltd.
Zendai and SOHO China have responded that the sale was taking place indirectly rather than in the joint venture company itself, a move that they say circumvents any preemptive bid.
Fosun lodged a competing bid, Zendai said, but it considered SOHO China’s offer better for shareholders. ($1 = 6.2946 Chinese yuan) (Additional reporting by Twinnie Siu; Editing by Charlie Zhu)