Wheelock and Co hopes to take advantage of the recovery of the property market to cut debts by 60 per cent to $2 billion in the next two years. Chairman Peter Woo Kwong-ching said the debt reduction programme would further improve the conglomerate's balance sheet. The company had a gearing ratio of 23 per cent on March 31. Wheelock, which has investments in properties, container terminals, trading and retailing through its 48 per cent-owned Wharf (Holdings) and 74 per cent-owned New Asia Realty, has net debts of about $6 billion. After the company's annual general meeting, Mr Woo said the firm had cut its net debts from $17 billion in 1997. He said further debt reductions would be helped by the sale of the first and second phases of its Bellagio residential project in Sham Tseng. BNP Paribas Peregrine predicted Wheelock's net gearing would fall to 8.7 per cent by the end of 2006 and 5.4 per cent by the end of 2007. It forecast the firm would reap more than $740 million in pre-tax development profits from the sale of the second phase of Bellagio. The brokerage house said the company would see its book value rise substantially over the next few years on improving asset prices for its property portfolio. With the improved cash-flow position, Mr Woo said the company would keep an eye on new investment opportunities to sustain longer-term growth.