Shui On Land is to raise up to HK$4.13 billion through a rights issue to finance its involvement in two large-scale urban renewal projects in Shanghai and future land acquisition.
The news came as the company revealed its full-year underlying profits had plunged 87 per cent year on year to 201 million yuan (HK$248 million) in 2012.
The company announced a rights issue of one new share for every three shares held. The rights shares will be priced at a steep discount of HK$1.84 each, or almost 45 per cent below Wednesday's closing price of HK$3.34 a share.
Shui On Land said it would raise a minimum of HK$3.67 billion and a maximum of HK$4.13 billion through the offering, and use the proceeds to assist in the relocation process for the Shanghai Taipingqiao and Rui Hong Xin Cheng projects, acquire assets or businesses which were relevant to its principal business and repay existing debts.
The firm's gearing ratio stood at 70 per cent last year, up from 65 per cent in 2011.
The cash call also came after the deferral of the US$1.5 billion spin-off of its commercial property unit, China Xintiandi, because of souring market sentiment.
