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Bidder Qingdao Haiyi to acquire HL Global’s 60% stake in Copthorne Hotel Qingdao

angela.teo@bizedge.com
Updated

SINGAPORE (Sept 19): HL Global Enterprises is disposing its 60% stake in Copthorne Hotel Qingdao Co. to Qingdao Haiyi Jun Zhuo Culture Travel Property Investment Co. for $43.8 million after a successful tender.

Copthorne Hotel Qingdao Co's main asset is Copthorne Hotel Qingdao in Qingdao, China. The hotel consists of a tower block and a convention centre and is located in Qingdao's central business district and has 455 guest rooms and suites. Copthorne Hotel Qingdao Co. has a registered capital of RMB217.4 million ($45 million).

Copthorne Hotel Qingdao Co. is held by HL Global through LKN Investment International. The remaining 40% in Copthorne Hotel Qingdao is held by a company called CAAC. The public tender was held on the Shanghai United Assets and Equity Exchange (SUAEE).

Qingdao
Qingdao

Among the terms of the disposal deal, Qingdao Haiyi will also pay $1.28 million owed by Copthorne Hotel Qingdao Co. to Equatorial Hotel Management, a subsidiary of HL Global; $3.2 million to LKN as as full settlement of the outstanding shareholder’s loan as well as outstanding loans of $11.9 million to Standard Chartered Bank (China).

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The disposal deal is a major transaction under Singapore Exchange's listing rules and is subject to the approval of the shareholders of HL Global.

In May, HL Global had entered into a conditional sale and purchase agreement with Natural Apex to dispose its 100% in LKN. Apart from its 60% stake in CHQ, LKN also owns Shanghai Hutai Real Estate Development Co.

HL Global says it will receive net proceeds of $111 million from the LKN disposal, which includes the proceeds from the sale of 60% stake in CHQ.

The net proceeds will be used to repay unsecured loans of $68 million owed by the company to Venture Lewis, a subsidiary of the controlling shareholder of the HL Global as well as for working capital and funding the acquisition of new businesses and assets.

The story, written by PC Lee, first appeared on The Edge Singapore.

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