Zhitong Finance APP was informed that Bank of Communications International issued a research report saying that due to the termination of real estate transactions by Jiu Mao Jiu (09922), based on the 2023 price-earnings ratio of 40 times, the previous 25 times, the rating was raised to “buy”, and the target price increased from HK $ 14.3 72.7% to HK$24.7. On Monday (3rd), the company announced that after careful consideration, it has decided to terminate the acquisition of 26% of the company’s shares held by Country Garden (02007) for 1 billion yuan. The termination of the transaction will not bring any claims or compensation to the parties. . The company’s chairman and controlling shareholder Guan Yihong will continue the transaction in his personal capacity on the same terms and conditions as before.
The bank agreed with the termination of the transaction, which it believes unnecessarily exposes the company to real estate market and counterparty risk. The closing of the deal is a positive sign that the board and management are willing to listen and change course based on investor feedback.
The bank also pointed out that it did not know how Guan Yihong would raise funds for the 1 billion yuan transaction. He owns a 40% stake in Jiu Mao Jiu, with a total transaction value of 1 billion yuan equivalent to 5%, and he may sell or pledge his holdings to obtain credit to finance the transaction.