By Clare Jim
HONG KONG: China Vanke Co Ltd, the major residential property developer at the centre of a high-profile power struggle among its shareholders, said core profit rose 49 percent in the third quarter as it benefited from fast growth in overall sales in the country.
The result comes amid signs that the tussle – which is rare in China – is taking its toll on Vanke with it losing its top spot in national sales rankings to China Evergrande Group at the end of August.
The Shenzhen-based company has already said that moves by its largest shareholder, financial conglomerate Baoneng Group, had resulted in shrinking confidence among partners and customers, cancelled projects and tighter credit.
July-September core profit, which excludes revaluation changes of investment properties, was 2.8 billion yuan ($413 million), it said in a filing.
Fearing a hostile takeover bid by Baoneng, Vanke’s management announced in June a $6.9 billion deal with white knight Shenzhen Metro Group Co Ltd. Both Baoneng and Vanke’s second-largest shareholder, China Resources Co Ltd, have said they would oppose the deal.
In an unexpected development, Evergrande has also joined the fray, building up a near 7 percent interest in Vanke although its intentions are not clear.
Vanke did not give further updates on the power struggle in Thursday’s earnings statement. It earlier reiterated it was still negotiating with all relevant parties and fine-tuning the terms of the Shenzhen Metro deal. ($1 = 6.7800 Chinese yuan renminbi) ( Editing by Edwina Gibbs and Christopher Cushing)
Source: Reuters