Latest news with #SSASAC
Yahoo
28-01-2025
- Business
- Yahoo
Vanke's No. 1 investor installs chairman in ailing developer to guide its way out of debt
Embattled builder China Vanke, once the second-largest Chinese developer by sales, reshuffled its management while forecasting a record US$6.2 billion net loss for 2024 as it struggles to get out from under US$4.9 billion in debt maturing this year. The company named a chairman with a state-linked background, sending positive signals about its ability to pay its debts after a bond sell-off triggered ratings downgrades from Fitch Ratings and S&P Global a week ago. The news boosted prices of Vanke's bonds. Yu Liang resigned as chairman due to "work adjustment reasons", but would remain with the company as a director, Vanke said in a filing with the Hong Kong stock exchange on Monday. The new chairman Xin Jie is also chairman of state-owned Shenzhen Metro Group, the developer's largest shareholder. Do you have questions about the biggest topics and trends from around the world? Get the answers with SCMP Knowledge, our new platform of curated content with explainers, FAQs, analyses and infographics brought to you by our award-winning team. With assets of more than 5 trillion yuan (US$689 billion), the Shenzhen State-owned Assets Supervision and Administration Commission (SSASAC) has "the ability, strength and enough 'bullets' to support Shenzhen Metro Group to promote a stable development of Vanke through all possible means", an SSASAC representative said on Monday, according to state-owned newspaper Nanfang Daily. The asking price of Vanke's bond maturing in 2025 advanced 11 per cent, while the asking price of its bond maturing in 2029 rose 9 per cent, according to Dealing Matrix, a bond information provider. Vanke said in a separate filing that it expects a net loss of 45 billion yuan for 2024, down from a 12 billion yuan net profit in 2023, citing falling sales and profit margins, provisions for credit and inventory impairments, and losses in bulk asset and equity transactions. Earlier, the company reported that total sales plunged 34.6 per cent year on year in 2024 to 246 billion yuan. Despite the state-backed expression of confidence in Vanke's fate, some analysts raised concerns. "Vanke's issue stems from the imbalance between supply and demand in China's housing market," said Shen Meng, director at Beijing-based investment firm Chanson & Co. "With demand waning, no matter how many homes are built, they struggle to sell, preventing the formation of a closed cash-flow loop. While state-owned enterprises can offer financial support, they can't solve the problem of selling the properties." Xin has served as a Vanke director since July 2020 and was vice-chairman of the company's board from October 2023 to this month. Yu Liang, then chairman of China Vanke, speaks at a press briefing in March 2018 in Hong Kong. Photo: Edward Wong alt=Yu Liang, then chairman of China Vanke, speaks at a press briefing in March 2018 in Hong Kong. Photo: Edward Wong> CEO Zhu Jiusheng also resigned from his role, due to health issues, and would hold no position in the company, Vanke's filing said. The management reshuffle followed a report that Zhu was detained by public security authorities, which state media outlet The Economic Observer reported on January 16 but later deleted. On January 20, Fitch downgraded Vanke's long-term foreign and local-currency issuer default ratings (IDRs) to B- from B+. It also lowered the long-term IDR of Vanke Real Estate (Hong Kong), a wholly owned subsidiary, to CCC+ from B, among other adjustments. Fitch has now cut the firm's creditworthiness five times since July 2023. This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2025 South China Morning Post Publishers Ltd. All rights reserved. Copyright (c) 2025. South China Morning Post Publishers Ltd. All rights reserved. Sign in to access your portfolio
South China Morning Post
27-01-2025
- Business
- South China Morning Post
China Vanke forecasts record US$6.2 billion loss, shuffles management
Embattled builder China Vanke , once the second-largest Chinese developer by sales, reshuffled its management while forecasting a record US$6.2 billion net loss for 2024 as it struggles to get out from under US$4.9 billion in debt maturing this year. The company named a chairman with a state-linked background, sending positive signals about its ability to pay its debts after a bond sell-off triggered ratings downgrades from Fitch Ratings and S&P Global a week ago. The news boosted prices of Vanke's bonds. Yu Liang resigned as chairman due to 'work adjustment reasons', but would remain with the company as a director, Vanke said in a filing with the Hong Kong stock exchange on Monday. The new chairman Xin Jie is also chairman of state-owned Shenzhen Metro Group, the developer's largest shareholder. With assets of more than 5 trillion yuan (US$689 billion), the Shenzhen State-owned Assets Supervision and Administration Commission (SSASAC) has 'the ability, strength and enough 'bullets' to support Shenzhen Metro Group to promote a stable development of Vanke through all possible means', an SSASAC representative said on Monday, according to state-owned newspaper Nanfang Daily. The asking price of Vanke's bond maturing in 2025 advanced 11 per cent, while the asking price of its bond maturing in 2029 rose 9 per cent, according to Dealing Matrix, a bond information provider. Vanke said in a separate filing that it expects a net loss of 45 billion yuan for 2024, down from a 12 billion yuan net profit in 2023, citing falling sales and profit margins, provisions for credit and inventory impairments, and losses in bulk asset and equity transactions.
