SPG Land shares soar on news of stake deal
Price spike comes as mainland developer Greenland acquires majority stake in SPG
Shares of SPG Land (Holdings) surged 86.91 per cent on an announcement that mainland developer Greenland Holding Group will acquire a majority stake in the company.
SPG Land, a developer focusing on the development of high-end residential and integrated properties in the Yangtze River Delta, saw its shares up HK$3.32 to HK$7.14 after trading resumed in Hong Kong yesterday.
"SPG is not purely a shell company, it has assets in value of 6 billion to 7 billion yuan," said Bocom International property analyst Alfred Lau. The stock won investors' favour yesterday as the deal will help the firm better utilise Greenland's balance sheet and its presence in China, according to Lau.
On Wednesday, SPG Land announced that Greenland agreed to subscribe to the subscription shares and convertible preference shares, representing 60 per cent of the enlarged issued share capital of SPG Land at a price of HK$1.9 per share, or a total consideration of HK$2.996 billion.
The share price represented a discount of 50.3 per cent to the closing price of HK$3.82 per share on April 18, the last trade before the stock was suspended from trading on April 19.
This is the latest backdoor listing sought by sizeable mainland developers.
