Hong Kong-listed property arm of Swire Pacific Ltd has agreed to sell the entire office building, Cityplaza One, to Rocha Land Ltd, in a move to realise cash from its investment for use in general working capital, Swire Properties said in a filing to the Hong Kong bourse late on Monday.
The property group said the deal is part of its ongoing business strategy of disposing certain non-core assets to enable the company to recycle capital and channel it to new projects.
“We remain committed to Hong Kong and to our long-term investment strategy in our home market,” an official with Swire Properties said in a statement. “We’re confident in the Hong Kong office market’s long-term outlook.”
Swire Properties said the deal will be settled partly by cash and by the issue of shares representing 37% of the holding company of Rocha Land, which in turn will represent an indirect equity interest of 37% in the Cityplaza One property.
Swire Properties is expected to record a gain on disposal of about HK$2.01 billion on a statutory basis, while Swire Pacific is expected to record an attributable gain on disposal of about HK$1.65 billion on a statutory basis, it added.
Separately, Swire Pacific’s flagship carrier Cathay Pacific Airways Ltd is undergoing a restructuring, recently announcing that it will slash 5,900 jobs and end its regional carrier as it grapples with a plunge in demand due to the coronavirus pandemic.