Surprise UAE deal adds US$70 million to China Aoyuan’s value as founder retreats
Founder Guo sold 16.38 per cent of the developer to little-known Abu Dhabi-based ‘strategic investor’, trimming his own stake to 13.31 per cent
Shares of China Aoyuan Group surged after founder Guo Zi Wen trimmed his controlling stake and a “strategic investor” from the Middle East emerged as the single largest shareholder of the cash-strapped developer.
The stock rose 127 per cent to HK$0.27 in Hong Kong on Monday, enriching its shareholders by HK$548 million (US$70.4 million), and bringing its advance this year to 35 per cent. The broader market weakened, as the Hang Seng Index slipped 0.1 per cent after earlier hitting a three-month high.
Guo agreed to sell 621.7 million shares to little-known Multi Gold Group on September 20, without disclosing the transaction terms, according to a stock exchange filing on Saturday. The sale gave the mystery buyer a 16.48 per cent stake in the developer, while Guo reduced his interest to 13.3 per cent.
Multi Gold’s sole director and owner is 45-year-old Mohamed Obaid Ghulam Badakkan Alobeidli. He has since been named chairman and non-executive director of China Aoyuan. Guo stepped down as chairman and has been redesignated as non-executive director.
“Multi Gold is likely to develop a material strategic relationship with Aoyuan in connection with its present or future business,” Aoyuan said in the filing. “Looking ahead, it is anticipated that Alobeidli will introduce potential investors and bring more development opportunities to the company.”
