Birmingham to pay Yeung up to HK$1.5b for mainland plot
English Premier League football club owner Birmingham International Holdings will pay its chairman and controlling shareholder Carson Yeung Ka-sing up to HK$1.5 billion for a large piece of vacant land in the mainland's northeastern Liaoning province.
Hong Kong-listed Birmingham, which bought the Birmingham City football club in 2009, said it plans to buy the 1 million-square-metre site in the Panjin Economic Development Zone from Yeung 'to diversify the business of the group'.
The land is currently zoned for industrial use, but the cash-and-shares deal calls for Yeung to attempt to have it rezoned for commercial and residential development, the company said yesterday.
However, Birmingham described the transaction as an investment in 'sports-related concepts, which include development of property in the PRC, development of community with unique British style and life culture [sic], and development of integrated property project [sic] by injecting British high [sic] and new industrial, educational and sports (including but not limited to football) elements under the brand 'Birmingham'.'
Liaoning has seen more colourful developments than a British-themed industrial-sports-housing complex.
The rust-belt province was earlier home to the massive 'Holland Village' developed by disgraced Chinese-Dutch tycoon Yang Bin, which featured a full-size replica of the Peace Palace in The Hague, Amsterdam's central train station, windmills, castles, a Venice water park, a zoo and vacation villas.
But Holland Village became a white elephant after Yang was jailed in 2003 for 18 years for fraud and bribery. The site was bulldozed in 2009.
Birmingham's plans lack detail but appear quite different in nature, and the firm no doubt hopes the cachet of its English Premier League side will lead to a highly successful industrial and/or residential project.
The Panjin land deal calls for Birmingham's wholly-owned firm Golden Abaccus [sic] to pay Yeung an initial 155 million yuan (HK$182.86 million) in cash and 275.95 million yuan worth of convertible preference shares for 90 per cent control of the site, which is currently being developed for industrial use.
If Yeung succeeds in having the land re-zoned for commercial and residential use, he would be entitled to an additional payment of up to 901.07 million yuan in preferential Birmingham shares.
That would theoretically boost his stake in Birmingham to 74 per cent, but exercise of the new shares would be subject to certain caps to maintain a 25 per cent public float, according to the company.
Shares in Birmingham rose 15 per cent after the deal was announced to close at 22.7 HK cents yesterday, giving the company a market value of HK$723.6 million.
The size in square metres of the plot of vacant industrial land in Liaoning: 1m