Yuexiu Property Co. Ltd. has secured the option to purchase a 51% stake in each of two integrated projects in Guangzhou, China, from strategic shareholder Guangzhou Metro Group Co. Ltd.
Guangzhou Yue Xiu Holding Ltd., the controlling shareholder of the Hong Kong-listed property developer, entered into an agreement to acquire a 51% interest in each of the two project companies for total consideration of 7.85 billion Chinese yuan, as well as to provide further funding to the companies.
Further, Guangzhou Yue Xiu and Yuexiu Property entered into two option deeds to grant the latter the right to acquire the 51% stake and initial loan interests in the two companies from its controlling shareholder. Yuexiu Property may exercise its option to acquire the interests for a total consideration of around 9 billion yuan. Each option can be exercised by Yuexiu Property after the acquisition of the interests by Guangzhou Yue Xiu and on or before Dec. 31.
The two properties are a 282,931-square-meter mixed-use land plot adjacent to the Xiangxue Station in Huangpu district with gross floor area of 911,922 square meters and a 242,094-square-meter residential site east of the Chentougang Station in Panyu District with gross floor area of 881,240 square meters.
Following the exercise of both options, the gross floor area of Yuexiu Property's metro-related developments will increase to around 3.25 million square meters, or approximately 16.7% of its current total land bank.
As of May 28, US$1 was equivalent to 6.91 Chinese yuan.