Country Garden Services seeks US$1 billion from stock placement with eyes on acquisition opportunities
- Country Garden Services is placing 173 million shares at HK$45 each, pricing new shares at a 9.4 per cent discount to Thursday’s closing price
- The stock placement follows the issuance of HK$3.84 billion worth of convertible bonds between April and June this year
Country Garden Services Holdings, the property management arm of mainland Chinese developer Country Garden, plans to raise HK$7.78 billion (US$1 billion) from the sale of new shares, which it plans to use to fund potential mergers and acquisitions.
The company is placing 173 million shares at HK$45 each, according to an exchange filing on Friday. The price represents a 9.5 per cent discount to the closing price on Thursday. It appointed China International Capital Corp, JPMorgan Chase and UBS to arrange the placement.
The company’s shares fell by as much as 7.1 per cent in the morning before paring losses to trade 4.5 per cent lower at HK$47.45 after the lunch break. The benchmark Hang Seng Index rose 0.3 per cent.
“In terms of placement by a property management [company], it is probably [the] biggest,” said Lung Siu-fung, an analyst with CCB International Securities. The firm is taking advantage of the liquidity in the market to bulk up its finances for growth opportunities, he added.
