Hong Kong Property Stocks Surge As Vanke Gets $579 Million Loan From State Backer to Repay Debt
China Vanke Co. received another round of financial support from authorities, with its largest state shareholder planning to offer up to 4.2 billion yuan ($579 million) to help the distressed developer repay outstanding debt.
Shenzhen Metro Group Co., which holds a 27% stake in Vanke, plans to provide a three-year term loan facility to be guaranteed by up to 6 billion yuan-worth assets, according to a Friday filing to the Shenzhen Stock Exchange. The proposed financing followed a 2.8 billion yuan loan offer last week also from the state-backed metro operator, highlighting the government’s support for the struggling developer.
Meanwhile, China’s decline in new-home prices eased for a fifth month in January, suggesting values are beginning to stabilize as policymakers step up efforts to end the property slump.
Hong Kong property stocks surged in morning trading. Sunac China rose 11%; Ronshine China rose 7%; China Vanke, China Jinmao, and Greentown China rose 6%; Longfor Group rose 5%.
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