Shimao Property to buy majority stake in Shanghai Shimao

Shimao Property Holdings will acquire a 64.2% stake in its Shanghai-listed subsidiary, Shanghai Shimao worth US$1.01 billion, in exchange for 11 commercial and retail properties, the Wall Street Journal reported. According to the terms of the agreement, Shanghai Shimao will issue 630 million new A-shares to Shimao Property at a 50% discount from Monday's closing price of RMB23.99 (US$3.20). The properties that will be turned over to Shanghai Shimao include Beijing Shimao Tower. Hong Kong-listed Shimao Property said the deal will allow the company to develop projects in mainland China more effectively and raise funds via the A-share market. In the future, Shimao Property will focus on residential and hotel development, while Shanghai Shimao will focus on retail and office projects.