Guangdong Investment (GDI) is to dispose of a 55.2 per cent stake in a mainland property developer to its parent for 220.89 million yuan (about HK$207.01 million) to trim its debts.
Debt-ridden GDI, the listed flagship of Guangdong provincial government, said it would sell the stake in GZ Panyu Yue Hai Real Estate to its controlling shareholder Guangdong Yue Gang Investment Holdings.
The disposal is part of GDI's restructuring, according to chairman Li Wenyue. He said GDI was committed to a business strategy with particular emphasis on utilities and infrastructure.
It was GDI's plan to dispose and close 20 loss-making and non-core operations to raise HK$3 billion in the next five years, to help repay HK$4.5 billion in debt.
In February, GDI cashed in HK$31.48 million by disposing its entire 57.16 per cent interest in Guangdong Building Industries.
GZ Panyu was an 80:20 property development joint venture between GDI and an independent party. Following the disposal, GDI's interest in GZ Panyu will be lowered to 24.8 per cent.