China Vanke to raise RMB 11.2 bln through share issuance

Sep. 17, 2009 (China Knowledge) - China Vanke Co Ltd<000002><200002>, the country's largest publicly traded residential properties developer, obtained its shareholders' approval for a proposed refinancing plan, which is expected to raise up to RMB 11.2 billion by issuing new shares, sources reported.

Vanke said in a statement filed with the Shenzhen Stock Exchange yesterday that it will issue additional A shares accounting for up to 8% of the firm's total shares. The price of the offering is set at the average price for the last 20 trading days prior to the first day of issue.

RMB 9.2 billion from the proceeds will be invested in 14 property projects, while the remaining will be used to replenish its working capital, according to the statement.

The refinancing plan is made in accordance with Vanke's business model and to the interest of its shareholders, said Yu Liang, president of Vanke, adding that the firm is back to profit again and it is the right time to kick off the refinancing plan.

The share sale plan is still subject to the approval from the China Securities Regulatory Commission.