Shares of cash-strapped Hong Kong property developer New World Development surged on Thursday after a media report on a potential take-private deal.
Financial news provider Octus reported on Wednesday the developer, along with its controlling Cheng family, have been in discussions with U.S. private equity firm Blackstone BX.N regarding a potential financing deal of up to $2.5 billion, which could result in a joint take-private offer.
The discussions, which could involve preferred or ordinary equity, are still in the early stages and subject to change, Octus reported, citing sources.
As of 0246 GMT, New World’s shares gained 11% after jumping as much as 16% earlier in Thursday’s trading session.
New World, with a market capitalisation of HK$18.2 billion ($2.32 billion), did not immediately respond to a Reuters request for comment. Blackstone could not be immediately reached for comment.
In late June, New World closed an $11.2 billion loan refinancing package, one of the largest ever in Hong Kong, designed to bring the company back from the brink of default.
($1 = 7.8491 Hong Kong dollars)
($1 = 7.8493 Hong Kong dollars)
Reuters
