Evergrande to Delist Soccer Business as Coronavirus Widens Loss
Evergrande to Delist Soccer Business as Coronavirus Widens Loss
(Bloomberg) -- Billionaire Hui Ka Yan’s soccer club plans to delist from the nation’s over-the-counter market after Covid-19 hit revenue, dealing a further blow to the property mogul.
Guangzhou Evergrande Taobao Football Club Co., majority owned by China Evergrande Group’s main property unit onshore, said in a filing that a delisting will help the company adopt a new strategy and focus on its main business, without further elaborating. The company recorded four straight years of losses since its 2015 listing, and business suffered another setback in the first half of this year following the pandemic.
The soccer team, hailed for including China’s marquee players, is one of many non-property businesses backed by Evergrande, China’s second-largest residential developer. Once a highly sought after business, bolstered by President Xi Jinping’s interest in the sport, the team attracted the backing of billionaire Jack Ma’s Alibaba Group Holding Ltd.
Hui spared no resources, hiring World Cup-champion coach Marcello Lippi. Guangzhou Evergrande became the first Chinese team to win the Asian Champions League, the local equivalent of Europe’s most prestigious tournament.
The soccer operation joins a wave of companies delisting from the National Equities Exchange and Quotations, which is China’s biggest over-the-counter market but has little trading volume.
Hengda Real Estate Group, which holds Evergrande’s main property assets in China, holds 57% stake in the club. Alibaba has a 38% stake.
It’s unclear how much the delisting will cost. Guangzhou Evergrande offered to purchase shares for 40 yuan apiece, it said in a separate filing. The proposal is waiting for approval from its extraordinary shareholder meeting.
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With assistance from Bloomberg