CapitaLand Signs Deal to Sell Partial Stakes in 6 China Raffles City Developments to Ping An Life
Posted on 06/28/2021
Singapore-based CapitaLand has entered into conditional agreements to divest partial stakes in a group of companies that own six of its Raffles City developments in China, to Ping An Life Insurance Company of China, Ltd. (Ping An). The agreed value for the portfolio – comprising Raffles City Shanghai, Raffles City Beijing, Raffles City Ningbo, Raffles City Chengdu, Raffles City Changning (Shanghai) and Raffles City Hangzhou – is RMB 46.7 billion (about S$9.6 billion). Post-transaction, CapitaLand will retain an effective stake of 12.6% to 30% in each development. Under its signature “Raffles City” trademarks, CapitaLand will also continue to provide asset management services for these developments and earn fee income. Targeted for completion in third quarter of 2021, the transaction is expected to generate for CapitaLand net proceeds of more than S$2 billion.
70.0% onshore stake in RC Beijing, RC Chengdu, RC Ningbo, RC Hangzhou and RC Changning; and 60.0% onshore stake in RC Shanghai
CapitaLand will remain as the asset manager for all six Raffle City developments in China.
Raffles City Portfolio in China
Name, effective post stake for Capitaland, Year complete
RC Changning, 25%, 2017
RC Hangzhou, 30%, 2017-2018
RC Ningbo, 30%, 2012
RC Shanghai, 12.6%, 2003
RC Beijing, 30%, 2009
RC Chengdu, 30%, 2012
RC The Bund, 20.8%, 2021
RC Shenzhen, 30.4%, 2017
RC Chongqing, 100%, 2019
Ping An Life Insurance Company of China, Ltd. is a core member of Ping An Insurance (Group) Company of China.
Canada Pension Plan Investment Board (CPP Investments) agreed to sell its stake in six Raffles City developments in China. Net proceeds to CPP Investments from the sale would be approximately C$800 million before closing adjustments. CPP Investments invested in the first Raffles City China development, majority owned and managed by CapitaLand, in 2008. The partnership has since expanded through the development of new assets and additional acquisitions. CPP Investments first invested in Raffles City China shortly after they opened their Hong Kong office in 2008.
The sale is part of CapitaLand’s agreement with Ping An Life Insurance to divest partial stakes in the six Raffles City developments.
The transaction is subject to customary closing conditions and regulatory approvals.
CapitaLand will continue to hold stakes in and provide asset management services for these six Raffles City developments. CapitaLand is keen on expanding capital partnerships with China’s domestic institutional investors to diversify CapitaLand’s investor base. CapitaLand’s recent registration as a private equity fund manager in China allows the firm to carry out RMB-denominated capital raising, as well as provide fund management services in China.
In line with this investment strategy, CapitaLand announced in April 2021 that it is investing RMB3.66 billion to acquire its first hyperscale data center campus in Shanghai, China.