SRE Group announced the sale of its 51% stake in Shanghai Jinxin Property to Zhongchong Investment Group for 3.41 billion yuan. Zhongchong gains total control over the project, aiding its expansion strategy. SRE Group expects to use the 3.374 billion yuan proceeds to repay loans, improving financial stability. With a projected net gain of 74.5 million yuan, this divestment streamlines SRE Group's portfolio, focusing on core operations while aligning with long-term growth objectives.
The stake in Shanghai Jinxin Property has been sold by SRE Group to Zhongchong Investment Group, a China-based real estate developer. The listed SRE Group that its 51% stake in a unit involved in the real estate project in Shanghai has been sold for an enterprise value of 3.41 billion yuan (USD 472 million).
Shanghai Jinxin Property, the unit in which the stake has been divested, is primarily involved in the development of the Shanghai Daxing Road Project, located in the Huangpu District of Shanghai. This project encompasses various real estate ventures, including luxurious residences and commercial properties.
Through this deal, Zhongcheng Investment Group will acquire total indirect control over Shanghai Jinxin, as it already possesses the remaining stake through its majority-owned subsidiary.
From the stake sale, SRE Group anticipates net proceeds of 3.374 billion yuan, which will be utilised to repay its outstanding loans. A net gain of 74.5 million yuan is expected from the divestment.
In conclusion, the sale of its stake in Shanghai Jinxin Property represents a strategic move by SRE Group to optimise its financial position and focus on core business operations. This transaction not only provides the company with significant liquidity but also aligns with its long-term growth objectives.
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