State-owned major shareholders successively come to the rescue of Vanke

Author | Cao Anxun

The strong support of the state-owned major shareholder Shenzhen Metro Group for Vanke is rapidly taking shape.

On March 19, Zhongjin Yinli Consumer REIT issued a price inquiry announcement, and will conduct offline price inquiries from 9:30 to 15:00 on March 25. The price inquiry range is from 3.260 yuan per share to 3.529 yuan per share, and the subscription price of fund shares will be finally determined through offline price inquiries.

The announcement shows that the CSRC has approved the total amount of fund shares issued by Zhongjin Yinli Consumer REIT to be 1 billion shares. The initial strategic placement fund shares amount to 83.557 million shares, accounting for 83.6% of the total number of fund shares issued.

Among them, the original equity holder Yinli Commercial Real Estate intends to subscribe for 33% of the total fund shares issued. The initial fund shares for offline sale amount to 115.101 million shares, and the initial fund shares subscribed by the public investors amount to 49.329 million shares.

It is worth noting that Vanke's largest shareholder Shenzhen Metro Group, as the initial strategic investor, intends to subscribe for 29.8% of the total fund shares issued, reflecting Shenzhen's strong support for Vanke. Based on this calculation, Shenzhen Metro's subscription amount may be around 1 billion yuan.

This is only 6 days after Vanke announced Shenzhen Metro's intention to subscribe to Zhongjin Yinli Consumer REIT. The accelerated support now indicates Shenzhen Metro's importance to Vanke.

In fact, since last year, Shenzhen Metro's support for Vanke has been increasing, especially at critical moments when Vanke faced short-selling rumors, providing actual support or voicing support for Vanke.

In November last year, at a communication meeting between Vanke and financial institutions, Shenzhen State-owned Assets Supervision and Administration Commission and Shenzhen Metro voiced support for Vanke.

The Shenzhen State-owned Assets Supervision and Administration Commission stated that if necessary or in extreme circumstances, they have full confidence, sufficient financial resources and tools to help Vanke actively respond through project cooperation, optimizing equity investment structure, bond subscription, coordinating financial institution financing, and all possible market-oriented and legal means.

Shenzhen Metro also stated that they have prepared a rich "toolbox" and will release it in an orderly manner according to market conditions to support Vanke, helping Vanke revitalize large assets, with the transaction amount expected to exceed 10 billion yuan.

In October last year, Xin Jie, Chairman of Shenzhen Metro, was appointed Vice Chairman of Vanke's Board of Directors. At that time, Xin Jie emphasized that Shenzhen Metro will hold Vanke's equity for the long term. Behind Vanke is Shenzhen Metro, and behind Shenzhen Metro is Shenzhen State-owned Assets, which will steadfastly support Vanke's healthy development.

Moreover, Shenzhen State-owned Assets' substantial support for Vanke is continuing to materialize.

In January, Shenzhen State-owned Assets' investment platform Shenzhen Investment Holding acquired 6.16% of Shenzhen High-Tech Investment's equity from a subsidiary of Vanke.

With the successive support from Shenzhen State-owned Assets, investors' confidence in Vanke is also recovering.

Several leading domestic market-oriented investment institutions have participated in the strategic placement of Zhongjin Yinli Consumer REIT, reflecting the market's high recognition of the investment value of Zhongjin Yinli Consumer REIT and confidence in the long-term development of the asset listing platform China Jinmao Innoconsumption REIT itself is also a good investment target, initiated by the shopping center development and operation platform Inno Group under Vanke. The underlying asset Hangzhou Xixi Impressions City is the largest urban TOD shopping center in the west of Hangzhou in terms of scale. As of the end of September 2023, the occupancy rate reached as high as 99.6%. From January to September 2023, the turnover of Hangzhou Xixi Impressions City exceeded 3.19 billion yuan, hitting a historical high.

Industry insiders believe that public REITs for consumer infrastructure will help enterprises build a complete "investment, financing, management, and exit" business model loop, recirculate cash for revitalizing and improving existing assets or expanding new projects, achieve more efficient operation of assets and funds, further thicken the company's financial "safety net".

Financial institutions have also extended a helping hand to Vanke. On March 20, Vanke received support from the Shenzhen Branch of Industrial Bank, with a total of 1.4 billion yuan in loans for two subsidiaries to repay public debts.

To further gain the trust of financial institutions, Vanke provided guarantees for this loan matter, with Shanghai Central District Company mortgaging the Shanghai Central District project it holds and pledging the accounts receivable generated by the project to Industrial Bank.

With the collaboration of state-owned shareholders and financial institutions, as well as Vanke's active efforts, market confidence in Vanke will be restored at an accelerated pace