China’s Fosun International Ltd said on Monday it would raise $561 million by selling part of its shares in Zhaojin Mining Industry Co as part of its ongoing string of asset sell-downs.
The company, through one of its units, is offloading 654.1 million Zhaojin Mining shares for HK$6.72 each, a 1.8% discount from the closing price on Nov. 4.
Fosun had owned about 22.85% of Zhaojin Mining’s shares and will retain a 2.85% stake in the Hong Kong listed company.
The transaction announced on Monday is the second time Fosun has sold Zhaojin stock and has raised $663.73 million from both deals.
Fosun, controlled by billionaire entrepreneur Guo Guangchang, was once one of China’s most aggressive dealmakers overseas, buying high-profile assets including resort brand Club Med.
However, it is carrying out an accelerated asset sales programme to help reduce its high debt levels.
Moodys in October downgraded Fosun by one notch and said poor market sentiment meant Fosun was likely to face difficulties in refinancing its sizable short-term debt in bond markets both onshore and offshore.
Fosun said in mid-October its units would sell a combined 60% stake in Nanjing Nangang Iron & Steel United for up to 16 billion yuan ($2.19 billion), a move that would ease the firm’s liquidity and debt burdens.
Fosun and its units had earlier cut stakes in firms such as New China Life Insurance and Shanghai Yuyuan Tourist Mart Group.
($1 = 7.8496 Hong Kong dollars)
(By Scott Murdoch and Sameer Manekar; Editing by Daniel Wallis and Paul Simao)
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