Chinese Estates Holdings plans to go private after its stock was slammed by fallout from the crisis at Evergrande.
The Hong Kong developer had seen its shares plunge as much as 44% this year to their lowest level in nearly two decades as Evergrande teetered on the edge of collapse. Chinese Estates is the second largest shareholder in Evergrande after founder and chairman Xu Jiayin. « Directors are cautious and concerned about the recent development of China Evergrande Group including certain disclosures made by China Evergrande Group on its liquidity, » Chinese Estates said in a filing to the stock exchange late Wednesday. It offered to pay minority shareholders 1.91 billion Hong Kong dollars ($245 million) for their 25% stake and take the company private. The offer represented a premium of about 83% over the stock’s closing price on September 28, the last full day before it was suspended from trade. Chinese Estates Holdings, controlled by Hong Kong billionaire Joseph Lau and his wife Chan Hoi-wan, has been a long-time ally of Evergrande. It has often offered financial support to the Chinese developer by subscribing to many of its bond or stock sales since 2009, when Evergrande listed in Hong Kong.
