Li Ka-shing’s CK Asset Holdings may be eyeing a “shortcut” to bulk up its land bank in Hong Kong by leveraging its ties with Goldin Financial Holdings, according to some market analysts.
The possibility became a bit clearer after the conglomerate sent a top lieutenant, Gerald Ma Lai-chee, to offer financial and restructuring advice to the debt-stricken developer on Thursday to help alleviate a HK$18.5 billion (US$2.4 billion) debt burden.
CK Asset may be eyeing both Goldin’s well-publicised portfolio of assets as well as those held by its billionaire chairman Pan Sutong that include highly-valued sites overlooking Kowloon Bay, they added.
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“CK has a special interest in development sites with a sea view and in the vicinity of train stations, sites that are rate and cost a huge amount of money, said Kenny Tang, chief executive of Royston Securities. “This may present an opportunity for CK to pick up some bargains” given Goldin’s and the broader market distress, he added.
Despite its financial muscle, CK Asset only owns 4 million sq ft of land bank in Hong Kong, the least among the city’s major developers. Sun Hung Kai Properties has 58.9 million sq ft while Henderson Land Development owns 14.6 million sq ft, according to their annual reports.
Goldin’s key assets include its headquarters at 17 Kai Cheung Road on Kowloon Bay, a 27-storey office tower last assessed at more than HK$15 billion. It also owns a land parcel on the former airport strip in Kai Tak, where a planned sale in May was delayed amid its cash crunch.
Pan, who controls 70.8 per cent of Goldin, personally owns two residential properties in Ho Man Tin, one of which is next to MTR station. He also owns the Oriental News Building near the Kowloon Bay MTR station, which has redevelopment potential.
He developed the 401-unit luxury residential project known as Grand Homm, having sold only 22 units since October 2019 ranging from HK$28 million to HK$50.4 million, according to government records.
The appointment of 52-year-old Ma, who sits on CK Asset’s executive committee, “reflects their close relationship built over the years,” said Tang, who worked with Ma at boutique investment house AMTD in his time there from 2010 to 2016.
“Gerald is an old hand in mergers and acquisitions at CK Group, he can be expected to speed the restructuring efforts,” he said. “The appointment can also send out a message to the market to rule out the possibility that Goldin will file for liquidation. Those who are waiting on the sideline in hope of picking up its asset at fire-sale prices are likely to be disappointed.”
Nan Fung Development, a creditor and rival developer, is also a suitor for Goldin’s assets, according to a report published by Ming Pao on July 15. The company declined to comment, citing confidentiality in all its transactions.
The presence of CK Asset in Goldin would boost the confidence among Goldin’s lenders, said Raymond Cheng, head of Hong Kong and China research at CGS-CIMB Securities. It will ease the banks’ anxiety to some extent on Goldin’s ability to repay, he added.
Goldin is already embroiled in a legal fight with hostile creditors, who have appointed “purported receivers” to seize control of some its unit and their assets.
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More from South China Morning Post:
- Li Ka-shing’s CK Asset makes first step in rescue of distressed Hong Kong developer Goldin as hostile creditors seize assets
- Billionaire chairman of indebted property firm Goldin, Hong Kong ‘shop king’ among investors disposing of assets on the cheap to pay debt
- Hong Kong’s home buyers are back in droves at CK Asset’s Sea To Sky project as they shrug aside political concerns
- Li Ka-shing’s CK Asset Holdings throws weight behind Beijing’s security law for Hong Kong ahead of its biggest property launch this year
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