PETALING JAYA: Hong Kong-listed Shimao Group Holdings Ltd is disposing of its hotels and the hotel business for HK$2.7bil (RM1.4bil) to Oceanfront Hong Kong Ltd, a company owned by, among others, investment vehicles associated with ParkCity Group.
Shimao, in a filing with the exchange, said the sale and purchase agreements were entered into on Oct 20 by Brand Rise Ltd, an indirect wholly-owned subsidiary of Shimao acting through court-appointed receivers and managers. Completion is expected by the end of 2026.
The tender process was launched in June and closed on Aug 31, with the bidding described as highly competitive. The consideration was determined following arm’s length negotiations.
Shimao said the net proceeds from the disposal would be used by the receivers to partially repay outstanding borrowings under a syndicated loan agreement dated July 27, 2020, which is secured by a debenture and mortgage.
The repayment is expected to reduce the group’s overall indebtedness and strengthen its financial position as it continues efforts to address its liabilities in an orderly manner.
The company said the hotels constitute a specified offshore asset under its offshore debt restructuring, which took effect on July 21, 2025. The disposal will trigger provisions under the restructuring arrangements.
As the proceeds will first be used to repay the secured indebtedness, Shimao does not expect any net cash proceeds to be available for deposit into the designated account.
Shimao said Oceanfront Hong Kong and its ultimate beneficial owner(s) are independent third parties and are not connected persons of the company.
