Lai Sun and Cosco plan infrastructure play
Lai Sun Development Co says it will join forces with Cosco (HK) to invest in Chinese infrastructure projects in a move aimed at further extending co-operation with the mainland-backed conglomerate.
Senior vice-president Jacky Chiu Wai-ki said Lai Sun intended to set up an infrastructure unit with Cosco - the Hong Kong arm of China's biggest shipping company, China Ocean Shipping (Group) - to invest in toll roads, power stations and bridges in several major cities, including Jinan and Qingdao in Shandong province, and Tianjin.
He said Cosco's parent had interests in a number of infrastructure investments in China. Lai Sun and Cosco were studying investment opportunities in seven of these projects.
The new co-operation plan came weeks after Cosco became the second-largest shareholder in Lai Sun subsidiary Lai Sun Hotels International, with the purchase of a 20 per cent stake.
It also came days after Lai Sun announced it would buy a 2.25 per cent stake in Cosco's listed vehicle, Cosco Pacific.
Mr Chiu said the size of the planned infrastructure projects were estimated not to exceed $200 million each, with details finalised in a few weeks.
He said the infrastructure investment was part of Lai Sun's mainland expansion, leading up to the proposed Hong Kong spin-off of its China property subsidiary, Lai Fung Co, by the end of the year.
Lai Sun has mainland investments of about $3 billion through Lai Fung, mainly in real estate developments.