It says sale in line with its focus on selected key cities in China
By JAMIE LEE
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FRASER and Neave (F&N) said yesterday that it has sold a unit that is developing a hotel and residential villas in China. Subsidiary Frasers Centrepoint sold its full interest in Hong Kong-incorporated Metro Charm Holdings for about $201 million.
Metro Charm holds all of the equity in a development company based in Hainan. This unnamed company is working on a hotel and villa project with a book value of $128 million.
F&N said that the sale is in line with its focus on property development in selected key cities in China. Payment will be in cash and in two tranches, it said.
The sale is not expected to have a material effect on the group's net tangible assets per share in the current financial year.
F&N reported a net profit of $64.3 million for the second quarter ended March 31, down 33.5 per cent from a year ago.
DBS Vickers Securities has upgraded the stock to a 'buy' from a 'hold' rating last month. This came on the back of 'overwhelming response' to F&N's recent property launches in Singapore, analyst Andy Sim said. 'Recent positive property sentiment in China could also bode well for the group's developments there,' he said.
He also raised his target price for the stock to $4.52, from $3.44. F&N shares lost three cents to end at $4.11 yesterday.
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