In order to raise funds, “Country Garden Services” has sold all its shares in Zhuhai Wanda.
On the evening of October 29, “Country Garden Services” announced that its indirectly wholly-owned subsidiary sold 0.31% of the shares of Zhuhai Wanda Commercial Management Group Co., Ltd. for 649 million yuan. After the sale is completed, “Country Garden Services” will no longer hold any shares in Zhuhai Wanda.
The announcement showed that after deducting the initial purchase price of about 549 million yuan for the 0.31% shares, “Country Garden Services” will realize a profit of 100 million yuan.
The agreement stipulated that the buyer designated by Wanda must pay the transaction price within 10 working days from October 29. The payment will be made to “Country Garden Property Hong Kong” in cash in equivalent US dollars based on the exchange rate of the China Bank’s foreign exchange listing price on the payment date to 649 million yuan.
On September 25, “Country Garden Services” announced that it had sold its 1.49% stake in Zhuhai Wanda for 3.142 billion yuan. On October 14, Wanda paid the transaction amount.
Regarding the purpose of clearing the shares in Zhuhai Wanda, “Country Garden Services” stated in the announcement that the sale of shares will help raise funds and focus on core business.
According to information previously disclosed, in July 2021, Country Garden Services and Country Garden jointly spent 3.23 billion yuan to purchase a 1.79% stake, participating in the pre-listing financing of Zhuhai Wanda Commercial Management. On December 13, 2023, Country Garden resold the 1.79% stake in Zhuhai Wanda Commercial Management to Wanda for 3.069 billion yuan, resulting in a loss of about 160 million yuan.
The mid-year report of “Country Garden Services” shows revenue of 21.045 billion yuan, a year-on-year increase of 1.5%; a net profit of 1.44 billion yuan, a decrease of 38.7% compared to 23.51 billion yuan in the same period of 2023; a gross profit of 4.453 billion yuan, a year-on-year decrease of 13.7%; and operating cash flow from 21.9 billion yuan in the same period last year to 270 million yuan, a significant drop of 87.7%.
The report also shows that as of the end of June, the trade receivables scale of Country Garden Services was 21.958 billion yuan, an increase of about 2.4 billion yuan from the end of 2023, among which accounts receivable aged over 3 years increased from 376 million yuan to 601 million yuan.
Country Garden Services was established in 1992 as the property sector under the real estate company Country Garden (02007.HK). In June 2018, the company was split and Country Garden Services was listed, later becoming the largest property management company in terms of managed area in China.
Currently, there is no shareholding relationship between Country Garden and Country Garden Services, but they are affiliated companies. Both companies are controlled by Yang Huiyan, who currently holds about 36.12% of Country Garden Services shares.