China

China Vanke’s Partners Buy An Additional 26.48 Mln Shares On May 30

This article was originally published on June 2, 2014 at 11:54 pm EST

Summary:

  • According to NetEase Finance, China’s largest real estate developer China Vanke (CH: 000002) announced on June 2 that Shenzhen YingAn Financial Consulting Co., which represents the company’s 1,320 “business partners”, bought an additional 26.48 million A-shares, or 0.24% of the company, for RMB 226 million.
  • Shenzhen YingAn Consulting was launched on Apr. 25 by Vanke’s 1,320 partners. The 1,320 partners were selected in March from Vanke’s employees.

Why It Matters:

  • On May 28 Shenzhen YingAn bought 35.84 million A-shares, or 0.33% of China Vanke, for RMB 300 million. Then on May 29 Shenzhen YingAn bought nearly 23.19 million A-shares, or 0.21% of the company, for RMB 198 million.
  • After stock purchases over three consecutive trading days, Vanke’s partners now hold 0.78% of the company, paying RMB 724 million in total. Based on Vanke’s shareholder structire announced in its 2013 annual report, Shenzhen YingAn is now the seventh largest shareholder in Vanke.
  • Vanke adopted a partnership structure in order to give the board more power and to prevent a hostile takeover. Vanke’s ownership structure makes it an easy target for a hostile takeover bid. China Resources, Vanke’s largest shareholder, owns 14.7% of the company and is the only shareholder owning more than 2% of Vanke.