NEW WORLD DEV (00017.HK): SSE accepts spin-off application for K11 Shanghai property listing
- The securities investment fund has an expected offering size of approximately RMB 3,818 million based on the preliminary asset valuation and information available as at the announcement date; 20% of total fund units will be subscribed by the Group at an expected total subscription price of approximately RMB 764 million and 80% by external investors at approximately RMB 3,054 million, while the consideration for the asset disposal is currently expected to be approximately RMB 4,014 million.
- Upon completion, the Company's indirect interest in the project company and thereby in the asset will decrease from 100% to 20%, the project company will cease to be a subsidiary, the asset's financial results will no longer be consolidated, and the securities investment fund will be recognised as an associate in the Group's consolidated financial statements.
- After deducting the subscription amount payable by the Group and related costs and taxes, the Group will receive estimated net proceeds of approximately RMB 3,240 million from the proposed spin-off, to be used for repayment of loans and general corporate purposes.
NewTimeSpace News: On 21 September 2026, New World Development Company Limited (stock code: 17) published an announcement on the latest progress of the proposed spin-off and independent listing of a securities investment fund on the Shanghai Stock Exchange. Following the submission of application materials for the registration and listing of the securities investment fund to the CSRC and the SSE on 17 September 2026, the SSE issued a notice of acceptance regarding the proposed spin-off on 19 September 2026.
The announcement stated that the proposed spin-off will involve the independent listing of the securities investment fund on the SSE, with the fund indirectly holding all interests in the project company and thereby all interests in the asset. For the proposed spin-off, the fund manager will establish the securities investment fund as a publicly offered commercial real estate investment trust, with an expected offering size of approximately RMB 3,818 million based on the preliminary valuation of the asset and information available as at the date of the announcement, while the ABS manager will establish an asset-backed special plan. It is currently expected that 20% of the total fund units will be subscribed by the Group at an expected total subscription price of approximately RMB 764 million, and 80% by external investors at an expected total price of approximately RMB 3,054 million. The consideration for the asset disposal is currently expected to be approximately RMB 4,014 million.
Upon completion of the proposed spin-off, the Company's indirect interest in the project company, and thereby in the asset, will decrease from 100% to 20%, the project company will cease to be a subsidiary of the Company, and the financial results of the asset will no longer be consolidated into the Group's consolidated financial statements. After deducting the subscription amount payable by the Group for the fund subscription and related costs and taxes, the Group will receive estimated net proceeds of approximately RMB 3,240 million from the proposed spin-off, to be used for repayment of loans and general corporate purposes. The asset is a mixed-use property at 300 Huaihai Middle Road, Huangpu District, Shanghai, comprising Shanghai K11 Art Mall and Shanghai K11 ATELIER New World Tower, with a total floor area of approximately 130,384 sq m. The Company has applied for and obtained the Stock Exchange's approval for a waiver from strict compliance with the guaranteed entitlement requirement under paragraph 3(f) of Practice Note 15.
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