Chinese property developer Seazen to sell Changzhou Hengxuan for $187 mln (updated)

Seazen

26/09/2023 15:49

(Adds details, context in paragraphs 7-10)
       Sept 26 (Reuters) - Seazen Group  1030.HK  said on
Tuesday Asian investment firm PAG's subsidiary had agreed to buy
the Chinese property developer's business, which controls
Shanghai Xingyi Cinema Management, for 1.37 billion yuan. 
($187.45 million)
    The sale of Changzhou Hengxuan Consulting Management, which
owns a 97.6% stake in Shanghai Xingyi Cinema Management, to
PAGAC IV Holding II will allow Seazen Group to increase capital
and reduce its gearing ratio, the company said in a filing to
the Hong Kong stock exchange. 
    The property developer may use proceeds from the deal
primarily for loan and debt repayment, Seazen Group said. 
    Shanghai Xingyi and Changzhou Hengxuan altogether manage 144
cinemas in China, Seazen Group said. 
    The deal is subject to certain procedures including a review
by China's State Administration for Market Regulation, the
filing said. 
    Changzhou Hengxuan also agreed to repay loans of 856.4
million yuan owed to Wealthzone Development, a different
subsidiary of Seazen Group, the filing said.
    Shanghai Xingyi and Changzhou Hengxuan altogether reported
unaudited post-tax net profit of 86.8 million yuan in the first
six months this year, compared with a post-tax net loss of 64.9
million in 2022, said Seazen. 
    They reported a combined unaudited net asset value of around
170 million yuan as of end August. 
    Two management and employee shareholding platforms of Seazen
own 1.91% and 0.49% stake in Shanghai Xingyi respectively. 
    Chinese film producer and cinema operator Hengdian
Entertainment  603103.SS  last year said it and partners had
intended to buy Shanghai Xingyi for no less than 3 billion yuan 
($410.48 million), but the parties involved in the negotiations
failed to agree on core conditions.  

($1 = 7.3085 Chinese yuan renminbi)

 (Reporting by Roxanne Liu and Kane Wu. Editing by Jane
Merriman)
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