(Yicai Global) Aug. 15 -- China's real estate giant Greenland Holdings has acquired a majority stake in a previously state-owned property developer Tianjin Construction Engineering Group to turn it into a mixed-ownership company.
Shanghai-based Greenland bought a 65 percent stake in Tianjin Construction Engineering for CNY1.5 billion (USD216 million), state-backed The Paper reported, adding that the shareholders will increase a CNY500 million (USD72.4 million) investment in the shareholding ratio.
The next step will be forming a tri-party shareholding structure, which means that Greenland will give 10 percent of its stocks to the target firm's management team, while keeping 55 percent for itself. The remainder, some 35 percent of the shares, will be held by Tianjin State-owned Asset Supervision and Administration Commission.
Beijing has embarked on a mission to diversify the ownership structure of its state-owned enterprises to turn them more efficient and competitive and cut overcapacity by removing "zombie companies".
Greenland will promote Tianjin Construction Engineering to maintain 30 percent to 50 percent annual revenue and profit growth in the next five years, and strive to achieve the goal of over CNY100 billion in revenue from its main business by 2025, the parent firm's President Zhang Yuliang said.
Prior to this, Greenland has participated in three mixed-ownership reforms of SOEs, including Guizhou Construction Engineering Group, Jiangsu Construction Engineering Group, and Xi'an Construction Engineering.
Editor: Emmi Laine