Ping An Insurance denies reports it will take over Country Garden and its mountain of debts, declares zero stake in troubled developer
- Country Garden defaulted in late October after it failed to pay US$15.4 million of interest on a dollar-denominated bond
- Ping An said it has ‘never received any relevant proposals or requests from any relevant governmental authorities’ with regard to Country Garden
“The company has never received any relevant proposals or requests from any relevant governmental authorities [or] agencies, and the company has no transaction plan or discussion in connection therewith,” it said in a Hong Kong stock exchange filing on Wednesday. “As of today, the company does not hold any shares of Country Garden Holdings.”
The Reuters report was “completely untrue”, the insurer said, adding that the clarification could prevent shareholders and potential investors from being misled.
Country Garden trustee notice declares bond default after missed coupon payment
Chinese authorities have asked Ping An to take a controlling stake in Country Garden, Reuters reported on Wednesday, citing four people familiar with the plan. The State Council, headed by Premier Li Qiang, instructed the Guangdong provincial government to help arrange the rescue, it reported.
The report sent Ping An Insurance tumbling by 5.4 per cent to HK$38.50 in Hong Kong trading on Wednesday, while Country Garden surged 12.2 per cent to HK$0.83.
In the first six months of the year, Ping An reported a 1.2 per cent decline in net profit to 69.84 billion yuan. In the last two years, Ping An has raised its investments in rental income property while cutting its exposure to developers.
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Of the insurer’s 4.37 trillion yuan investment portfolio at the end of last year, real estate accounted for 4.7 per cent, with 60 per cent invested in physical buildings, an increase of 10 percentage points from two years ago. The rest was in equities or bonds issued by developers or other property assets.