Chinese developer buys stake in China Sports to tap sports facility sector

China Aoyuan Property has offered to pay 3.3 billion yuan for the stake to make further inroads into the sports-related property development sector on the back of a booming sports industry

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With the State Council projecting that the country’s sports industry to reach US$734 billion by 2025 amid growing interests and demand for sports and sports venues, developers and local governments are keen to capitalise on the trend. Photo: Xinhua

Published: 4:55pm, 6 Jul 2017Updated: 10:42pm, 6 Jul 2017

China Aoyuan Property said it has offered to pay 3.3 billion yuan (US$485 million) for an estimated 22 per cent stake of China Sports Industry Group , in a bid to tap into the country’s booming sports facility construction business.

The Guangzhou-based homebuilder said it has submitted the tender on Wednesday, at a price of no less than 17.53 yuan per share, according to a filing to the Hong Kong stock exchange.

In a separate statement to Shanghai stock exchange, China Sports said it intended to transfer 186 million shares, or 22.0733 per cent of the entire share capital. It said it had received one tender submission, which was from Aoyuan at the close of the tender.

Listed in Shanghai, China Sports, a governmental authority supervised by the General Administration of Sport of China, is mainly engaged in sports-related property development, construction and operation of sports stadiums. It currently has a market value of about 13 billion yuan.

Aoyuan, whose name translates into “Olympic Garden” in Chinese, had partnered with China Sports as early as 1997, when the two companies jointly developed Guangzhou Olympic Garden, a sports-themed residential project backed by the General Administration of Sport of China.

Chinese cities across the country are keen to draw investments to build sports facilities. Photo: May Tse

“With China Sports, Aoyuan could secure a lot of cheap land surrounding sports stadiums,” said Liu Feifan, a property analyst at Guotai Junan International.

With many Chinese cities vying to attract China Sports’ investments to build new sports venues to meet growing interests in sports, Aoyuan’s potential deal with China Sports gives it access to a huge market, he added.