Chus is the latest billionaire family to help their friend, the founder of Evergrande, with a 51 percent purchase offer.
Another billionaire tycoon looks poised to come to the rescue of embattled developer China Evergrande Group.
Hopson Development Holdings Ltd., a Hong Kong-listed real estate company controlled by the billionaire Chu family, has agreed to buy a majority stake in Evergrande’s real estate services company, Cailian reported Monday, citing people it did not identify. Evergrande Property Services Group Ltd. said in a statement its shares were shut down Monday due to a pending announcement of a potential offer for shares of the company. Hopson declined to comment.
The Chus could become the latest wealthy family to boost finances for Evergrande and its billionaire founder Hui Ka Yan. Hui’s so-called poker buddies were Joseph Lau of Chinese Estates Holdings Ltd., billionaire Henry Cheng of New World Development Co. and Cheung Chung Kiu of CC Land Holdings Ltd., although some have scaled back their investments in Evergrande.
Unlike Hui, who has been in the spotlight for years in the real estate industry, Chu Mang Yee has been described by Chinese media as an “invisible tycoon” due to his low profile. Chu and his son Chu Yat Hong together own about 71% of Hopson Development, and the family is worth about $6.2 billion, according to the Bloomberg Billionaires Index. Mang Yee’s daughter Chu Kut Yung has been the developer’s chairman since January 2020.
Like Evergrande, Hopson is based in the southern Chinese province of Guangdong. Shares have been listed on the Hong Kong Stock Exchange since 1998 and are up 40% this year, while Evergrande is down 80%. Hopson has a market value of HK$60 billion ($7.7 billion), compared to just HK$39 billion for Evergrande.
In the early 2000s, Hopson was once considered one of the top five developers in South China, along with Evergrande, Country Garden Holdings Co., Guangzhou R&F Properties Co. and Agile Group Holdings Ltd. It was also the first real estate developer in China to achieve revenues of 10 billion yuan ($1.55 billion) in 2004, according to Cailian.
Colleagues, including Evergrande and Country Garden, later surpassed Hopson as the faces of the Chinese real estate market. The developer is relatively little known worldwide, although it is the 13th largest real estate company in China by market capitalization.
Hopson Development plans to acquire a 51% stake in Evergrande Property Services to value the company at approximately HK$40 billion, a 28% discount to its current value of HK$55.4 billion, Cailian reported, after amendment from a previous valuation report. Evergrande made the property public in December.
Hopson’s dollar bills will have suffered their biggest losses ever after the report. The dollar 6.8% bond due 2023 fell 5 cents on the dollar to 90.1 cents, according to Bloomberg compiled prices as of 1 p.m. in Hong Kong.