Pacific Alliance China Land Limited has announced its financial results for the six months to 30 June 2016. Net asset value as at 30 June 2016 was US$133.69 million, representing US$2.1704 per share, a 3.97% decrease from 31 December 2015 (US$234.8 million). On 30 June 2016, the Company’s share price closed at US$1.88, representing a 2.3% decrease from 31 December 2015 and a 13.4% discount to the unaudited NAV per share.
The Company successfully exited two projects in the first of half of 2016. In the first quarter of 2016, the Company sold its 40% interest in Project Diplomat, together with its co-investor, to a local fund managed by CITIC Private Equity Fund Management Co., Ltd. The Company received net proceeds of US$84 million net of China taxes and transaction fees, representing a net IRR of 15.2%. The holdback of RMB35 million, of which the Company is entitled to 40%, is expected to be recovered by the end of 2016.
In the first quarter of 2016, the Company also received gross cash proceeds of RMB248 million from the sale of its Walmart shares (one of the remaining assets of Project Malls), which are currently held by a joint venture owned by the Fund and China Resources, which is currently in liquidation. Once this is completed, the upper level joint venture will also be liquidated and the repatriation process can begin.
With the proceeds from the two realizations, the Company announced a mandatory share repurchase with a total amount of US$96 million in June 2016. The Investment Manager will continue to manage the Company’s remaining investment in order to maximize the Company’s NAV.
Patrick Boot, Managing Director, Pacific Alliance Real Estate Limited commented that: “In the second half of 2016, we expect China’s economy to further stabilize. We also expect the property market to continue to improve at a more measured pace, supported by favorable government policies. The Investment Manager will focus its efforts on realizing the Company’s only remaining investment, Project Auspice (domestic shares of Wanda), to maximize value to shareholders.”
PACL : Pacific Alliance China Land focused on selling last remaining investment