China's Wanda Group gets $913 mln from sale of Australian projects (updated)

Wanda Hotel Development

29/01/2018 12:15

(Adds dateline, adds Yuhu's confirmation that it's the buyer) 
    By Clare Jim and Tom Westbrook 
    HONG KONG/SYDNEY, Jan 29 (Reuters) - Chinese conglomerate 
Dalian Wanda Group has agreed to sell its two Australian 
projects to a China-backed developer for a total of A$1.13 
billion ($913 million) in equity and assumed debt. 
    Wanda Group will get A$315 million for the sale, and the 
buyer will also repay A$815.1 million in assumed debt on behalf 
of the company, according to a statement by Wanda Hotel 
Development Co Ltd  0169.HK , the Hong Kong-listed unit of Wanda 
Group, on Monday.  
    The deal, signed on Jan. 18, comes just days after Wanda 
sold a high-profile London luxury development project for around 
$81 million, the latest in a string of asset sales that 
underscore financial strains hitting the Chinese conglomerate. 
 urn:newsml:reuters.com:*:nL3N1PC1LU     
    Wanda Group will cash in HK$10.32 billion ($1.3 bln) and 
make a total gain of HK$1.28 billion after the disposal of 
London, Sydney and Gold Coast developments. 
    The buyer is AWH Investment Group Pty Ltd, the statement 
said, an associate of China-backed Australian property and 
investment group Yuhu Group. 
    Yuhu, in an emailed statement to Reuters confirming the 
purchase, said the projects would create over 1,500 jobs in 
Australia. 
    "Consistent with the company's strategy to deleverage, the 
company considers that the disposal represents an opportunity 
for the group to realise its investment in both Gold Coast 
Project and Sydney Project and would benefit the group by 
strengthening the liquidity and financial position of the 
group," Wanda Hotel said. 
    Wanda Hotel said the disposal of the company, which owns the 
One Circular Quay in Sydney and 55 percent of the Jewel Resort 
on the Gold Coast which are both under development, would result 
in a gain of around HK$556 million for Wanda Group. 
    Wanda Hotel owns 60 percent of the company, while Wanda HK 
owns 40 percent. Both are subsidiaries of Wanda Group. 
    Wanda Hotel will also use around HK$4.1 billion of the 
proceeds to repay loans and interest due to Wanda HK, it added.  
   
    Shares of Wanda Hotel will resume trading on Tuesday. They 
have been suspended since Jan. 19.     
    The sales are expected to lessen financial strains on Dalian 
Wanda Group, caused by a major acquisition spree, by helping 
Wanda HK to meet upcoming debt deadlines.  urn:newsml:reuters.com:*:nL3N1PE1D2 
    China's regulators last year told banks to stop providing 
funding for several of Wanda's overseas acquisitions, sources 
have said, part of a crackdown on what Beijing sees as 
irrational spending by some domestic conglomerates. Since then, 
Wanda, whose businesses range from real estate to football and 
cinemas, has embarked on a string of asset sales. urn:newsml:reuters.com:*:nL3N1K82KV 
     
($1 = 7.8187 Hong Kong dollars) 
($1 = 1.2346 Australian dollars) 
 
 (Reporting by Clare Jim in Hong Kong and Tom Westbrook in 
Sydney; Editing by Jacqueline Wong and Susan Fenton) 
 ((clare.jim@thomsonreuters.com; +852 2912 6653; Reuters 
Messaging: clare.jim.thomsonreuters.com@reuters.net)) 
 
Keywords: WANDA HOTEL SALE/AUSTRALIA