CapitaLand acquires Oriental Overseas’ China property for $2.2 billion

Singapore's CapitaLand, one of Asia's largest real estate companies agreed to acquire the entire 100-per cent stake of Orient Overseas Developments Limited (OODL) from Hong Kong-based holding company Orient Overseas (International) Limited (OOIL) for approximately $2.2 billion, doubling its Chinese property portfolio by adding 1.48 million square metres (sqm) of strategic space.

CapitaLand will effect the buyout through its indirect wholly-owned subsidiary, CapitaLand China (RE) Holdings Co Ltd (CCH) which will acquire OODL's real estate business spread in seven sites located in Shanghai, Kunshan and Tianjin, the company said in a statement. 

CapitaLand has core businesses in real estate, hospitality and financial services that are focused in growth cities in Asia and Europe. The company's portfolio includes residential and office buildings and shopping malls and hotels spread over 110 cities in over 20 countries.

The total consideration of $2.2 billion comprises $1.046 billion for OOIL's debt and the balance of $1.54 billion for sale and transfer of all the issued and paid up share capital comprising 10,000 shares of par value HK$10 each.

The acquisition will increase CapitaLand's Chinese portfolio to 2.8 million sqm thereby growing the company's Chinese assets from 28 per cent to 36 per cent of its total business.

Out of a total gross floor area of 1.48 million sqm, about 87 per cent is located in Greater Shanghai (which includes Kunshan) while the remaining 13 per cent is in Tianjin. Residential properties constitute the largest component with 56 per cent, followed by office space 19 per cent, serviced residence/hotel 17 per cent and retail 8 per cent.