March 29, 2017 / 10:04 AM / 10 months ago

Goldin's Pan offers $1.5 billion to take Chinese developer private

HONG KONG, March 29 (Reuters) - Chinese property developer and hotel operator Goldin Properties Holdings Ltd said on Wednesday Chairman Pan Sutong had offered about $1.5 billion to buy its outstanding shares and delist the company.

The move comes nearly two years after shares of Goldin Properties soared 450 percent over a two-month period, prompting Hong Kong’s securities regulator to issue a warning to investors that the company’s shareholding structure could create volatility in prices. The shares later plunged and are now trading nearly 70 percent below their peak price in 2015.

Pan offered to buy Goldin Properties’ shares for HK$9 each, putting the total deal at HK$11.9 billion ($1.53 billion), the company said in a securities filing.

Trading in Goldin Properties was halted on Tuesday, pending the announcement of the take-private deal, and the shares jumped 6.2 percent on Wednesday to close at HK$8.37, once it resumed after Pan unveiled the buyout offer.

The take-private deal will give Pan “greater flexibility to support the future business development of (Goldin Properties) without being subjected to regulatory restrictions and compliance obligations associated with the listing status,” the company said in the filing.

Goldin Properties’ shares jumped more than fivefold over a two-month period between mid-March and mid-May 2015, only to slump 48 percent between May 20 and May 21 and bounce back up 73 percent in the following seven days, Hong Kong’s Securities and Futures Commission (SFC) said at the time.

The SFC had urged investors to exercise “extreme caution” in trading the shares because of potential volatility.

The SFC had issued a similar warning against China-based Hanergy Thin Film Power Group Ltd, another large Hong Kong-listed company with a concentrated shareholding whose share price fell dramatically in the span of one hour in 2015 before trading was halted. The stock remains halted. ($1 = 7.7672 Hong Kong dollars) (Reporting by Elzio Barreto; Editing by Sunil Nair)

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