(Bloomberg) -- Country Garden Holdings Co., a developer whose share price has almost tripled this year, scrapped a planned spinoff of a unit on Shanghai’s stock exchange amid China’s tightened scrutiny of initial public offerings.
The planned listing of Guangdong Country Garden Property Services Co. was canceled because of a recent change in policies by the Chinese authorities, the developer said in a filing to Hong Kong’s exchange late Monday. The share offer would’ve raised a maximum of 1.1 billion yuan ($166 million), according to a draft prospectus.
China’s securities watchdog started to reject more IPO applications after a new review committee came on board in mid-October, according to Caixin magazine. Country Garden is evaluating options including seeking a listing of property management-related assets on a securities exchange elsewhere, the company said.
Known for projects including the $100 billion Forest City development in southern Malaysia, Country Garden has surged 194 percent this year and was last month added to the Hang Seng Index. The scrapping of the proposed spinoff won’t have any material impact on Country Garden’s financial position, the firm said.
The company’s shares were down 1.3 percent in Hong Kong trading as of 11:06 a.m. local time.
While investors have been betting on the prospects of China’s large developers as the industry consolidates, there have been recent signs of caution as the housing market cools -- the firm’s shares are down from a September peak.
©2017 Bloomberg L.P.
With assistance from Emma Dong