Chinese developer Sunac sells shares in Harbin Ice and Snow World Park for US$138 million
Chinese property developer Sunac China Holdings is reported to have sold its stake in Harbin Ice and Snow World Park, operator of one of the world’s largest winter-themed parks, for US$138.1 million - marking the company’s latest effort to manage its debt burden and repay creditors.
Harbin Ice and Snow World Park offers an ice and snow tourist and cultural festival commissioned by Harbin Municipal Government and sponsored by Harbin Cultural Tourism Group. Since its founding, the Park has been expanding year by year. Covering more than 750,000 square metres and consuming ice and snow over 300,000 cubic metres, Harbin Ice and Snow World is one of the most important parts of Harbin International Ice and Snow Sculpture Festival.
South China Morning Post reports that the divestment of Sunac from Harbin Ice and Snow World Park comes amid Sunac’s efforts to restructure about US$2 billion in onshore debt.
The Beijing-based property developer released a stock exchange filing late on Friday which stated Sunac’s wholly-owned subsidiary, Harbin Sunac Culture & Tourism Industry, sold its 46.7% equity interest in the theme park operator to Harbin Sun Island Group, which previously owned a 52.8% stake in the target firm.
The Sunac unit will allocate US$28 million from the proceeds of the sale to repay Snow World, according to the filing. An additional US$56 million will be used to settle the pledged loan tied to its equity interest in that company.
According to the South China Morning Post, the divestment by Sunac reflects how China’s property developers remain mired in a deep liquidity crisis since a nationwide campaign called the ‘three red lines’ was implemented in 2020 to contain debt in the housing sector.
The three red lines define thresholds on borrowings, which were outlined by the central government in August 2020. Home prices across the country have now fallen by 30%, compared to their peak three years ago.
Sunac’s latest announcement comes as the Hong Kong-listed developer, with US$2 billion in unpaid onshore bonds, continues to make progress in managing its debt load.
More information on Harbin Ice and Snow World Park
Image. Credit: Harbin Ice and Snow World Park
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