Shui On Land sells Chongqing assets to China Vanke for 4.1 billion yuan

Shui On Land, the property developer founded by tycoon Vincent Lo Hong-sui, has sold one of its largest mixed commercial projects in mainland China for 4.1 billion yuan (US$596.3 million).

In a statement to the Hong Kong stock exchange on Friday night, Shui On said it would reap a profit of about 1.7 billion yuan by selling a 79.2 per cent stake in Chongqing Tiandi to China Vanke, the second-largest developer in the country.

The deal would also reduce its net gearing by 11 per cent, the firm said.

Shui On will keep a 19.8 per cent stake in the project.

The disposal is in line with the developer’s strategy to pare its debt through asset sales.

With a ratio of debt to common equity of 123.8 per cent, Shui On has been selling assets since 2015 to reduce debt as part of chairman Lo’s “asset-light” strategy, according to his interview in the March issue of The Peak magazine, which is published by the South China Morning Post.