August 15, 2012 / 2:36 AM / 7 years ago

Developer Chinese Estates says Macau land deal declared invalid

HONG KONG, Aug 15 (Reuters) - Developer Chinese Estates Holdings Ltd, controlled by billionaire Joseph Lau, said Macau’s chief executive has declared a land sale to the company invalid, the second high-profile scandal to hit a Hong Kong property company this year.

The site in Asia’s gambling capital is at the centre of a corruption case involving Lau and tycoon Steven Lo, chairman of the South China Football Club and movie-and-music entertainment group BMA Investment.

Chinese Estates, which is building a luxury development on the site near a string of casinos on Macau’s Cotai Strip, said in a statement late on Tuesday that the 2006 land sale had been declared invalid and it was seeking legal advice on the notice.

Chinese Estates’ subsidiary Moon Ocean, previously owned by Lo, has 15 days to object to the decision or appeal to the courts.

The news comes a month after Thomas and Raymond Kwok, the billionaire co-chairmen of Sun Hung Kai Properties, and Rafael Hui, Hong Kong’s former No.2 public official, were charged in a bribery investigation surrounding Asia’s largest developer.

Chinese Estates said it has pre-sold 304 apartments at the Macau development, known as La Scala, generating sales of HK$3.8 billion and deposits of HK$384 million.

Lau, a former Goldman Sachs employee, and Lo are due to face trial in Macau in September on charges of offering a HK$20 million bribe to a former Macau government official.

Lau has denied any wrongdoing. Lo has testified he did not pay a bribe.

The former official, Ao Man-long, was Macau’s secretary for transport and public works and the most senior government figure ever arrested by Macau’s anti-graft agency.

He is already serving 29 years in jail for accepting bribes to speed approval of projects.

Shares of Chinese Estates, of which Lau owns 75 percent, were flat on Wednesday morning against a 0.8 percent drop on the benchmark Hang Seng Index. (Reporting By Anne Marie Roantree; Editing by Richard Pullin)

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