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Billionaire Cheng Empire on the Brink? New World Rushes to Sell China Icons, Eyes $2B Lifeline
Billionaire Cheng Empire on the Brink? New World Rushes to Sell China Icons, Eyes $2B Lifeline

Yahoo

time4 days ago

  • Business
  • Yahoo

Billionaire Cheng Empire on the Brink? New World Rushes to Sell China Icons, Eyes $2B Lifeline

After locking in an $11 billion refinancing deal in June, New World Development (NDVLY) isn't slowing down. The Hong Kong developer is now pushing to offload major real estate assets across mainland Chinapiece by piece. On the block: its marquee K11 properties in Hangzhou, Shenzhen, and Shanghai. According to people familiar with the matter, these sales are tied to loan terms agreed with banks, which want faster recovery and quicker deals. The firm is prioritizing buyers like private equity funds that can move fast and pay cash. But this isn't a fire saleyet. The company's sights are set on raising capital efficiently, while navigating a fragile operating environment. Warning! GuruFocus has detected 8 Warning Signs with NDVLY. The bigger play could be unfolding back home. New World is now seeking up to $2 billion through a new loan backed by its most valuable assetVictoria Dockside, a waterfront development in Hong Kong seen as the crown jewel of the portfolio. The deadline for bank commitments is July 11, though that could shift, as is common in the syndicated loan market. Still, analysts warn: while the last refinancing bought time, it didn't shrink the debt. New World's net debt stood at 95.5% of equity as of December. Its full-year loss in 2024the first in two decadesonly adds pressure, especially with no clear succession plan in place after Adrian Cheng exited the board earlier this month. The outlook? Cloudy at best. China's property market remains in a slump, and valuations are under pressure. New World reportedly wants 2.85 billion yuan (about $397 million) for its Shanghai K11 tower, but in today's environment, price is just one part of the challengefinding willing buyers is another. The firm still holds HK$50 billion ($6.4 billion) in completed investment properties in mainland China. But with Hong Kong real estate prices near nine-year lows and banks tightening lending terms, the Cheng family may need to act decisivelyor risk losing control of an empire under stress. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data

New World is selling China property assets after loan deal: sources
New World is selling China property assets after loan deal: sources

Business Times

time4 days ago

  • Business
  • Business Times

New World is selling China property assets after loan deal: sources

[HONG KONG] New World Development is seeking to divest real estate projects in mainland China after pulling off an US$11 billion refinancing deal in June, according to people familiar with the matter. The Hong Kong developer is planning to sell property assets in China piecemeal, including landmarks like its K11 buildings in Hangzhou, Shenzhen and Shanghai, the people said, asking not to be named because the matter is private. New World is expediting asset sales as part of its agreement to secure its June loan refinancing agreement with banks, the people added. The company favours buyers such as investment funds or private firms that can make swift decisions and offer faster cash recovery, one of them said. The developer remains in the spotlight as it continues to face liquidity stress and is seeking to raise as much as US$2 billion through a new loan that would be backed by its crown jewel asset, Victoria Dockside in Hong Kong. The firm set a commitment deadline for Jul 11, Bloomberg previously reported. It's common for borrowers to extend such deadlines for various reasons in the syndicated loan market. 'The prior refinancing has only eased the liquidity strains but not reduced overall debt balance,' said Jeff Zhang, an analyst with Morningstar 'Finding buyers with reasonable valuation may take long durations.' A NEWSLETTER FOR YOU Tuesday, 12 pm Property Insights Get an exclusive analysis of real estate and property news in Singapore and beyond. Sign Up Sign Up New World had HK$50 billion (S$8.2 billion) in completed investment properties in mainland China as of Dec 31, according to Bloomberg Intelligence. Its prospects for selling the assets are clouded by the country's ongoing real estate downturn and slowing economy. In Shanghai, the company is seeking 2.85 billion yuan (S$508 million) for its K11 tower, according to a property agent brochure. New World did not respond to an emailed query. Controlled by the family empire of Hong Kong tycoon Henry Cheng, New World has one of the highest debt burdens of any big developer in the city. Its net debt reached 95.5 per cent of shareholders' equity as of December, according to Bloomberg Intelligence. The funding environment for troubled and small Hong Kong developers has become increasingly challenging given that property prices in the city are now around a nine-year low. Banks are demanding stricter refinancing terms and asking for more credit enhancements. New World had been exploring other options earlier in the year, including holding talks with Chinese state-owned firms about a potential full sale of the company, according to other people familiar with the matter. The Cheng clan, worth an estimated US$21 billion as of March, proposed a semi-bailout to New World about two years ago, when it offered to take a subsidiary private and give the developer about HK$21.7 billion. The firm reported its first annual loss in 20 years for the 12 months ended June 2024. Adrian Cheng, the eldest son of the family's patriarch Henry Cheng, stepped down as chief executive officer soon after that, and this month he left the board. The Cheng family also owns a stake in Chow Tai Fook Jewellery Group Adrian Cheng's siblings include Sonia Cheng, who looks after the Rosewood Hotel. BLOOMBERG

Hong Kong developer New World eyes sale of China assets after refinancing deal
Hong Kong developer New World eyes sale of China assets after refinancing deal

South China Morning Post

time4 days ago

  • Business
  • South China Morning Post

Hong Kong developer New World eyes sale of China assets after refinancing deal

New World Development is seeking to divest real estate projects in mainland China after pulling off an US$11 billion refinancing deal in June, according to people familiar with the matter. The Hong Kong developer was planning to sell property assets in China piecemeal, including landmarks like its K11 buildings in Hangzhou, Shenzhen and Shanghai, the people said, asking not to be named because the matter is private. New World was expediting asset sales as part of its agreement to secure its June loan refinancing agreement with banks, the people added. The company favours buyers such as investment funds or private firms that could make swift decisions and offer faster cash recovery, one of them said. The developer remains in the spotlight as it continues to face liquidity stress and is seeking to raise as much as US$2 billion through a new loan that would be backed by its crown jewel asset, Victoria Dockside in Hong Kong. The Victoria Dockside in Hong Kong is New World's crown jewel asset. Photo: Handout The firm set a commitment deadline for July 11, Bloomberg previously reported. It is common for borrowers to extend such deadlines for various reasons in the syndicated loan market.

New World seeks to sell China real estate assets after loan deal
New World seeks to sell China real estate assets after loan deal

Business Times

time4 days ago

  • Business
  • Business Times

New World seeks to sell China real estate assets after loan deal

[HONG KONG] New World Development is seeking to divest real estate projects in mainland China after pulling off a US$11 billion refinancing deal in June, according to sources familiar with the matter. The Hong Kong developer is planning to sell property assets in China piecemeal, including landmarks such as its K11 buildings in Hangzhou, Shenzhen and Shanghai, the sources said, asking not to be named because the matter is private. New World is expediting asset sales as part of its agreement to secure its June loan refinancing agreement with banks, the sources added. The company favours buyers such as investment funds or private firms that can make swift decisions and offer faster cash recovery, one of them said. The developer remains in the spotlight as it continues to face liquidity stress and is seeking to raise as much as US$2 billion through a new loan that would be backed by its crown jewel asset, Victoria Dockside in Hong Kong. The firm set a commitment deadline for Jul 11, Bloomberg previously reported. It's common for borrowers to extend such deadlines for various reasons in the syndicated loan market. New World had HK$50 billion (S$8.2 billion) in completed investment properties in mainland China as at Dec 31, according to Bloomberg Intelligence. Its prospects for selling the assets are clouded by the country's ongoing real estate downturn and slowing economy. A NEWSLETTER FOR YOU Tuesday, 12 pm Property Insights Get an exclusive analysis of real estate and property news in Singapore and beyond. Sign Up Sign Up In Shanghai, the company is seeking 2.9 billion yuan (S$518 million) for its K11 tower, according to a property agent brochure. New World did not respond to an emailed query. Controlled by the family empire of Hong Kong tycoon Henry Cheng, New World has one of the highest debt burdens of any big developer in the city. Its net debt reached 95.5 per cent of shareholders' equity as at December, according to Bloomberg Intelligence. The funding environment for troubled and small Hong Kong developers has become increasingly challenging, given that property prices in the city are now around a nine-year low. Banks are demanding stricter refinancing terms and asking for more credit enhancements. New World had been exploring other options earlier in the year, including holding talks with Chinese state-owned firms about a potential full sale of the company, according to other sources familiar with the matter. The Cheng clan, worth an estimated US$21 billion as at March, proposed a semi-bailout to New World about two years ago, when it offered to take a subsidiary private and give the developer about HK$21.7 billion. The firm reported its first annual loss in 20 years for the 12 months ended June 2024. Adrian Cheng, the eldest son of the family's patriarch Henry Cheng, stepped down as chief executive officer soon after that, and this month he left the board. The Cheng family also owns a stake in Chow Tai Fook Jewellery Group. Adrian Cheng's siblings include Sonia Cheng, who looks after the Rosewood Hotel. BLOOMBERG

New World Seeks to Sell China Real Estate Assets After Loan Deal
New World Seeks to Sell China Real Estate Assets After Loan Deal

Bloomberg

time4 days ago

  • Business
  • Bloomberg

New World Seeks to Sell China Real Estate Assets After Loan Deal

New World Development Co. is seeking to divest real estate projects in mainland China after pulling off an $11 billion refinancing deal in June, according to people familiar with the matter. The Hong Kong developer is planning to sell property assets in China piecemeal, including landmarks like its K11 buildings in Hangzhou, Shenzhen and Shanghai, the people said, asking not to be named because the matter is private.

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