It is selling its Singapore and Malaysia residential property arm to Malaysian conglomerate Sunway Group as it exits the residential build-to-sell sector
[SINGAPORE] Shares of Hongkong Land surged to a six-year high in intraday trade on the Singapore Exchange on Friday (Sep 19) after the real estate group announced a S$738.7 million sale of its residential development arm MCL Land.
At 9.38 am, the counter hit US$7.45, with 3.4 million shares changing hands. This was 12 per cent or US$0.80 above Thursday’s closing price of US$6.65. This was the highest price the stock had reached since March 2019, ShareInvestor data showed.
The stock later retreated to finish the day at US$6.73, still up by 1.2 per cent or US$0.08, with nearly 15 million shares changing hands.
On Thursday, Hongkong Land said it would sell its Singapore and Malaysia residential property arm MCL Land to Malaysian conglomerate Sunway Group. The S$738.7 million cash deal was Sunway’s largest deal to date and pushed its investment in Singapore past S$1.2 billion.
Sunway will take ownership of MCL Land and its subsidiaries following the deal. This includes ongoing development projects in Singapore, alongside MCL Land’s portfolio of income generating and development assets in Malaysia.
MCL is a residential developer in Singapore and Malaysia. Its Singapore residential projects include Nava Grove, Elta and Copen Grand.
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Hongkong Land chief executive Michael Smith told the media on Thursday that the deal is at net asset value.
The transaction is expected to complete in the next one to two months and is part of the company’s capital recycling strategy.
In October 2024, the company announced plans to exit the residential build-to-sell sector to focus on ultra-premium integrated commercial projects in Asian gateway cities such as Hong Kong, Shanghai and Singapore. Then, Smith had told The Business Times that Hongkong Land’s core competencies were in integrated complexes.
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The changes were a result of a comprehensive strategic review of the business.
Speaking on the recent deal, Smith said that most of its proceeds will go to future endeavours, including such projects. About US$150 million will be used to extend the group’s share buyback programme.
Founded in 1889 and incorporated in Bermuda, Hongkong Land is a member of the giant Jardine Matheson Group. It has a primary listing on the London Stock Exchange, with secondary listings in Singapore and Bermuda.
