Tuesday, March 11, 2008

Soho China to delay share sale in mainland bourse

Soho China Ltd.<410>, the Beijing developer that earned US$1.9 billion in Hong Kong IPO last October, will not sell shares in the mainland stock market this year after the local benchmark dropped 17% this year, according to Soho China's CEO Zhang Xin.

Previously on Dec. 3, 2007, Soho China announced its intention to sell shares in mainland this year. Since then, the CSI 300 index of 300 Chinese stocks has declined 7.3% to a seven-month low.

Soho China has fallen 38% this year in Hong Kong, which caused the company's value shrink to HK$26 billion (US$3.3 billion).

Selling local-currency shares makes it easier for Soho China, the biggest developer in Beijing's central business district, to finance new projects, Zhang said. Builders in China's capital face rising costs as the average high economic growth in the last 15 years drove up land prices.

Soho China on Mar. 9 said 2007 profit rose almost six times to RMB 1.97 billion (US$277 million), boosted by increased demand for properties.

The company's focus on commercial developments limits the effects of government measures to curb residential prices, Zhang said.

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