Tuesday, January 19, 2010

Capitaland Buys OOIL China Property for $2.2 Billion

CapitaLand Ltd., Southeast Asia’s biggest developer, agreed to buy the Chinese property assets of Orient Overseas (International) Ltd. for $2.2 billion, doubling its real estate holdings in the world’s most-populous nation.

The purchase of the Orient Overseas Developments Ltd. unit includes seven sites in Shanghai, Kunshan and Tianjin, with about 1.48 million square meters of floor space, the Singapore- based developer said in a statement after markets closed yesterday. About half is residential and the rest is office, retail and hotel space, CapitaLand said.

CapitaLand has cash after it raised S$2.8 billion ($2 billion) from the initial public offering of CapitaMalls Asia Ltd. in November. Orient Overseas, Hong Kong’s biggest container line, is exiting real estate projects in China after a slump in global trade and excessive capacity in the shipping industry led to its first loss in 10 years. Orient Overseas posted a $231.8 million loss in the first half ended June 30.

“It’s a good price,” said Geoffrey Cheng, a transport analyst at Daiwa Institute of Research in Hong Kong. “Orient Overseas should be using the cash to focus on shipping.”

CapitaLand, which was suspended yesterday, rose as much as 3.7 percent, the biggest intraday gain since Oct. 22, to S$4.44. The stock traded at S$4.43 as of 9:16 a.m. in Singapore. Orient Overseas will resume trading today after being suspended in Hong Kong yesterday.

1 comment:

Jurong said...

There is a ray of hope in this recession too.

Related Posts Plugin for WordPress, Blogger...

My Blog List