for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up
Deals

Evergrande sells property management unit stake for $3 billion ahead of possible IPO

FILE PHOTO: A logo of China Evergrande Group is displayed at a news conference on the property developer's annual results in Hong Kong, China March 28, 2017. REUTERS/Bobby Yip

HONG KONG (Reuters) - China Evergrande Group 3333.HK said it sold 28% of a property management unit for HK$23.5 billion ($3 billion), bringing in strategic investors ahead of a possible IPO for the unit.

Shares in Evergrande jumped more than 6% in early Friday trade on the news.

The property developer said last month it was considering a spin-off and separate listing for the unit, which is called Mangrove 3 Ltd.

The introduction of strategic investors will enhance the corporate profile of the business and support its growth, it said in a filing late on Thursday.

Fourteen investors bought into the deal, including Chan Hoi Wan, also a major shareholder in Chinese Estates Holdings Ltd 0127.HK, who purchased 5.4% and Huatai International which bought 4.8%.

Sequoia Capital, CITIC Capital and Tencent Holdings 0700.HK also invested, Evergrande said.

The property management unit had a profit of 922.5 million yuan ($133 million) in 2019, nearly four times higher than a year earlier.

Reporting by Clare Jim; Editing by Edwina Gibbs

for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up