China developer Country Garden to spin off its property management business in Shanghai
Country Garden Holdings, mainland China’s third largest builder, has been given the green light to spin-off its property management firm, Guangdong Country Garden Property Services (CG Property Services) in Shanghai.
CG Property Services received approval from regulators on Wednesday for the initial public offering and listing on the Shanghai Stock Exchange of its ordinary shares denominated in yuan , Country Garden said in a filing with the Hong Kong stock exchange.
“The proposed spin-off will further strengthen the corporate governance structure of CG Property Services and enhance the liquidity of its equity interest, thus facilitating the introduction of strategic investors, promotion of corporate image and realisation of sustainable development,” said executive director Wu Jianbin.
“The board believes that a separate listing of CG Property Services will provide diversified funding
sources for it to finance existing operations and future expansions,” the filing said.
It is expected that CG Property Services will make an offering of up to 40.1 million shares for subscription on the Shanghai exchange, representing approximately 10 per cent of its enlarged issued share capital.
CG Property Services is a non-wholly owned subsidiary of Country Garden and is responsible for the property management business of the group, including residential properties, commercial properties, tourism properties and combined purposes properties.
CG Property Services also carries out property management related consulting services, household cleaning and maintenance services, landscaping and landscaping maintenance services and property leasing. Certain subsidiaries of CG Property Services are also licensed in the management and operation of car parks and recreational facilities such as basketball courts, tennis courts, football fields, badminton courts and swimming pools.
The firm said it submitted an application for the proposed spin-off of CG Property Services to the China Securities Regulatory Commission on August 31.
Hong Kong-listed shares of Country Garden rose 2.48 per cent to close at HK$4.13 on Wednesday.