Shui On units contribute to 910m yuan needed for venture
Shui On Group's two listed property and construction units will contribute to a cash injection of 910 million yuan in a property joint venture in Dalian to meet a new capital requirement.
Shui On Land and Shui On Construction and Materials (Socam) said in a joint stock exchange statement that the injection would be in order to meet Beijing's increase in the required capital level for the earlier stages of new projects.
To cool an overheating property market, investors must pay a minimum 50 per cent equity for projects worth more than US$10 million.
The joint venture, in which Shui On Land has a 48 per cent stake and Socam has 22 per cent, announced in May a 1.5 billion yuan plan to develop Dalian Software Park Phase Two, a project serving the information technology industry.
The remaining 30 per cent is held by Dalian-based Yida Group.
The companies said the increase in property prices, coupled with a series of policy measures by the government to slow growth in the market, had affected mainland developers.
Shares of Shui On Land yesterday dropped 0.62 per cent to close at HK$8 while Socam shares fell 0.8 per cent to HK$24.75.