Evergrande invests $1.4bn in competitor China Vanke

epa01819957 (FILE) A file photo dated 27 March 2009 shows workers at the 'Royal Scenic Peninsula', a luxury real estate development constructed by the Evergrande Real Estate Group, Guangzhou, China. The Guangzhou-based developer, which has the largest land bank in China, announced at the 08 - 09 August 2009 that it will launch an IPO in Hong Kong, hoping to raise as much as HK$11.7 billion (Euro1.065 billion). It is the second time Evergrande has try to list in Hong Kong, after it's first aborted attempt in 2008 due to unfavourable market conditions caused by the global financial crisis. EPA/ALEX HOFFORD

 

Bloomberg

Evergrande Real Estate Group Ltd., controlled by billionaire Chairman Hui Ka Yan, paid 9.1 billion yuan ($1.4 billion) for a 4.68 percent stake in China Vanke Co., the competitor embroiled in an ownership tussle with a key shareholder.
The Guangzhou-based developer bought Vanke’s Shenzhen-traded shares through a unit, it said in a filing to Hong Kong’s stock exchange after the market close on Thursday. Evergrande cited Vanke’s “strong” financial performance as China’s largest developer as a reason for its investment, according to the filing.
Vanke, China’s biggest residential developer by sales, has been in a battle for control since last year when Baoneng Group displaced China Resources (Holdings) Co. as the property company’s largest stakeholder. The entry of Evergrande as a shareholder is the latest twist in a dispute that has even drawn scrutiny from China’s securities regulator. The China Securities Regulatory Commission last month urged Vanke’s management and shareholders to end their dispute and reprimanded them for ignoring market stability and tarnishing the company image.

EVERGRANDE ACQUISITIONS
Evergrande earlier on Thursday denied a media report saying that the developer had purchased a stake in Vanke. The A-shares of Vanke surged by the 10 percent daily limit on Thursday, advancing for a fourth day, to close at 19.67 yuan on the Shenzhen exchange. That was the biggest increase since trading resumed July 4 after a six-month suspension.
Evergrande, based in Guangzhou in southern China, has been one of the most acquisitive developers in the country. It paid 3.6 billion yuan earlier this year for a stake in Shenzhen-listed China Calxon Group Co. and acquired Mass Mutual Tower in Hong Kong last year, as well as agreeing to buy assets from New World China Land Ltd.
The company’s buying spree went beyond real estate. In
April, Evergrande boosted its stake in Shengjing Bank Co. In November, it bought a 50 percent stake
in Great Eastern Life Assurance Co.’s Chinese joint venture for 3.9 billion yuan.

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