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The $7 billion property-management unit of ailing developer China Evergrande Group said it could be the subject of a takeover bid, a deal that could bring in much-needed cash for its parent company.
Shares in both Evergrande and its management arm, Evergrande Property Services Group Ltd., were halted in Hong Kong on Monday. The subsidiary said the halt was pending an announcement concerning “inside information and a possible general offer for the shares of the company.”
A rival developer, Hopson Development Holdings Ltd. 754 1.65% , said Monday that its shares were halted pending an announcement about a transaction involving a Hong Kong-listed target company, which it didn’t name.
Evergrande has fallen behind on payments to global bondholders. It has been trying to raise funds by selling assets outside its core development business, including stakes in its property-management and electric-vehicle arms, and a Hong Kong office building. Last week Evergrande agreed to sell down its stake in a commercial bank.
Property management has boomed as an industry in China, and many of the country’s big developers have obtained separate stock-market listings for these businesses, which manage apartment complexes and help residents with services such as child care, groceries and repairs.
Evergrande’s subsidiary, which listed on the Hong Kong stock exchange in December 2020, has a market capitalization of about $7.1 billion, according to FactSet. As of May, Evergrande retained a stake of nearly 61% in the business, filings show.
Evergrande didn’t immediately respond to a request for comment. Calls to Hopson’s Hong Kong and mainland offices weren’t answered. Mainland China is observing a weeklong holiday following its national day on Oct. 1.
—P.R. Venkat contributed to this article.
Write to Elaine Yu at [email protected]
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