A Metro Holdings Ltd. joint venture is investing nearly 2.91 billion yuan to buy and renovate a seven-story mixed-use building in Shanghai called Shanghai Plaza.
The joint venture, Shanghai Yi Zhou Property Management Co. Ltd., will be owned by Metro China Holdings Pte. Ltd.'s Shanghai Xing Chu Business Consulting Co. Ltd. and other independent third-party investors. The subsidiary will own a 35% equity interest in the venture, which translates to an investment of 265 million yuan and will be funded through internal cash sources and debt, according to a May 17 agreement.
On the same day, the joint venture's Shanghai Shang Min Business Consulting Co. Ltd. subsidiary entered into a sale and purchase agreement for a 90% interest in the property's current owner, Shanghai Yong Ling Property Development Co. Ltd. The deal, which is subject to the approval of the target's ultimate shareholder, also gives Shanghai Shang Min the option to completely buy out Shanghai Yong Ling Property from the property by 2020.
Shanghai Plaza has a gross floor area of 40,693 square meters with a 12,422-square-meter basement floor for car parking.
As of May 17, US$1 was equivalent to 6.37 yuan.