New | New World China Land sells hotel management unit to parent Chow Tai Fook

New World China Land has agreed to sell its hotel management business to parent, Chow Tai Fook Enterprises, for HK$1.96 billion in a move to focus resources on property development and investment on the mainland.

The disposal of its New World Hotel Management will enable the group to offload its investments in non-core business, according to the company's filings with the Hong Kong Stock Exchange.

New World China is expected to gain HK$844 million from the sale and the proceeds will be used for expansion of its core businesses and as general working capital.

The move comes as the mainland property market shows signs of recovery, with home prices rising in June for a second month in a row. Average new home prices across 100 major mainland cities tracked by Beijing-based consultancy China Index Academy rose 0.56 per cent month on month in June, from May's 0.45 per cent rise. That helped home prices end the first half of this year up 0.82 per cent, despite a 0.18 per cent dip in the first quarter.

New World China is 69.6 per cent owned by New World Development, whose controlling shareholder is Chow Tai Fook, with a holding of 43.41 per cent.

New World Hotel Management encompasses 55 hotels in 18 countries under three brands - Rosewood, penta and New World.