NWS to book gain on Kwai Chung land disposal to CR Holdings

PUBLISHED : Tuesday, 21 June, 2016, 8:31am
UPDATED : Tuesday, 21 June, 2016, 8:31am

New World Services (NWS) has agreed to sell a plot of land on which its NWS Kwai Chung Logistics Centre is located to the Hong Kong logistics unit of state-backed conglomerate China Resources (Holdings) for HK$3.75 billion.

NWS, a subsidiary of tycoon Cheng Yu-tung-controlled conglomerate New World Development, expects to book a “fair value” gain of HK$850 million from the disposal for the 12 months to June 30, New World Development and NWS said in a joint filing to Hong Kong’s stock exchange late on Monday.

“The disposal will be a good opportunity for NWS to realise its long-term investment in the property,” the filing said.

“By unlocking the value in the property through the disposal, NWS realises cash resources to fund its general working capital as well.”

Shine Fame, the wholly-owned unit of NWS that owns the land, booked a net profit of HK$279.2 million in the 12 months to June 30 last year, up from HK$131 million in the previous financial year.

The purchaser, Delaware Industrial, a wholly-owned unit of conglomerate China Resources (Holdings) that engages in retailing, power generation and property development, is an investor in logistics facilities in Hong Kong.

The purchaser will assume all the loans owed by Shine Fame to NWS as part of the purchase agreement.

The land sold is located in the Kwai Chung container port in Hong Kong.