Chinese builder Future Land puts 40 projects up for sale after former chair Wang Zhenhua charged with child sex abuse
- Its Shanghai-listed subsidiary Seazen Holdings is in negotiations with partners to sell its stakes in about 40 projects in China
- Both Future Land and Seazen have seen their share prices battered since the scandal broke at the start of July
Chinese builder Future Land Development Holdings is offloading 40 projects, just three weeks after it was engulfed in scandal when its former chairman was detained on suspicion of sexually assaulting a nine-year-old girl.
In a statement filed to the Hong Kong stock exchange on Tuesday morning, the company said its Shanghai-listed subsidiary Seazen Holdings is in negotiations with partners to sell its stakes in about 40 projects in China.
They will be sold at below market rate to various small and medium-sized Chinese developers, according to people with knowledge of the matter speaking on condition of anonymity.
The scandal that has rocked the company will have a “negative impact” on its operations and profits in the long term, according to Raymond Cheng, head of Hong Kong and China property research with CGS-CIMB Securities.
“That’s why it is disposing its asset to buffer its financial standing, which is a responsible act from shareholders’ perspective,” he said.
Chongqing-headquartered Jinke Property Group has already agreed to buy 10 of the projects, mostly in regions surrounding Shanghai, according to Chinese media reports. Jinke declined to comment when approached by the Post, saying only that it will provide details when the deal size reaches public disclosure standards.
