(Yicai) Feb. 26 -- Shares of Gree Electric Appliances fell after the Chinese home appliance giant said Chinese private equity giant Hillhouse Capital intends to trim its stake in the company for the first time since its investment six years ago.

Gree [SHE: 000651] closed 2.3 percent down at CNY37.59 (USD5.50), which represents a decline of nearly 19 percent from the price Zhuhai Mingjun paid.

Zhuhai Mingjun Investment Partnership, an investment fund controlled by Hillhouse, will sell up to 112 million Gree shares, equal to about 2 percent of the total, in the three months starting in 15 trading days, aiming to raise funds to repay bank loans, Gree announced yesterday. Based on the company's current stock price, the value of the sale is expected to be around CNY4.2 billion (USD614.3 million).

Zhuhai Mingjun, which also boasts an investment company owned by Gree's Chairwoman Dong Mingzhu as an investor, acquired a 15 percent stake in Gree from state-owned Zhuhai Gree Group for CNY41.7 billion (USD6.1 billion) in January 2020, becoming the Zhuhai-based firm's largest shareholder.

Due to Gree's multiple share repurchase programs in recent years, Zhuhai Mingjun's shareholding has increased to 16.1 percent. Dong holds about 1.8 percent.

As the Chinese air conditioning market is experiencing an overall downturn, Gree faced some financial pressure last year. In the first three quarters, its net profit narrowed 2.3 percent to CNY21.5 billion from a year earlier, while its revenue fell 6.6 percent to CNY137.7 billion (USD20.1 billion), according to the company's latest financial report.

Editor: Futura Costaglione