Lifestyle shares jump on spin-off plans
Operator of Sogo stores announces scheme to realise the value of some of its mainland assets
Shares of Lifestyle International Holdings rose strongly yesterday after the department store operator announced plans to explore a separate listing for its Hong Kong and mainland property business on the Hong Kong stock exchange.
The operator of Hong Kong's Sogo and Shanghai's Jiuguang department stores said in a filing that the property investment and development business to be spun off was not intended to be used in the operation of its core department store business.
It said the net asset value of the proposed business accounted for about 18 per cent of the unaudited consolidated net asset value of the company as of June.
Lifestyle will remain the holding company of the proposed spun-off business.
Phoebe Wong, an analyst at Bocom International, said the move was positive for Lifestyle since the listing of non-core properties would allow it to realise hidden asset value.
"In addition, Lifestyle's business can become much more clear-cut and transparent with management resources concentrated on department store operation," Wong said.