Another real estate company is leaving the capital markets. On the evening of October 23, Minmetals Land announced that its major shareholder plans to privatize the company for a total consideration of no more than HKD 1.276 billion and has applied to delist from the Hong Kong stock market. This state-owned enterprise has been listed in Hong Kong for 34 years and has total assets of approximately HKD 40 billion. Currently facing severe operational challenges during a period of profound adjustments in the real estate sector, Chairman He Jianbo has emphasized internally since the beginning of the year that the primary goal is to ensure the company "survives." If the privatization is successful, Minmetals Land will be 100% controlled by China Minmetals.
Sources within the company indicated that it may integrate with China Metallurgical Group's real estate platform. Following the major shareholder's announcement, the secondary market reacted enthusiastically. On October 24, Minmetals Land resumed trading, opening with a 90% surge to close at HKD 0.94 per share, giving it a market value of about HKD 3.1 billion. The market was not surprised by the premium offer for the privatization of Minmetals Land. By mid-October, 45 domestic companies had voluntarily delisted from the Hong Kong stock market in 2023, including Dayuecheng Real Estate and Beijing Construction.
As one of the real estate platforms under China Minmetals, Minmetals Land focuses on residential development, along with commercial, hotel, and township projects, with residential development accounting for nearly 90% of its revenue. Its development has been relatively conservative since its listing, with a limited presence in the market. Since He Jianbo took over as chairman of the board in 2019, he had expressed ambitious goals to reach the scale of a billion-dollar real estate company. Unfortunately, even at its peak, Minmetals Land's sales were less than HKD 30 billion, placing it outside the top tier in industry rankings.
Following the industry's adjustment period, the company has seen a continuous decline in sales, leading to a prolonged period of low stock prices, with its market value hovering around HKD 1.6 billion prior to the privatization announcement. Leaving the Hong Kong stock market is ultimately a reluctant decision, as it has long experienced low liquidity, with an average daily trading volume of about 440,000 shares over the past 12 months, representing only approximately 0.03% of its shares without a conflict of interest.
The announcement stated that the privatization proposal could provide an exit opportunity for minority shareholders. Since 2009, Minmetals Land has not raised funds through stock placements, losing the fundraising advantage of being a listed company. "The industry is still in a stabilization phase, and the company urgently needs to adjust and optimize its strategy to maintain its core competitiveness," the announcement explained.
Currently, China Minmetals holds approximately 61.88% of Minmetals Land's shares. The offer for the privatization is seen as sincere, with 1.276 billion shares expected to be involved. The major shareholder plans to acquire shares at HKD 1 per share, representing a 104% premium over the price before suspension.
The past three years have been particularly difficult for Minmetals Land. In 2024 alone, it reported a net loss of HKD 3.748 billion. He Jianbo has stated that the priority is to ensure "survival," focusing on inventory reduction and risk prevention, trying every possible means to increase income and control expenses to reduce losses. Simultaneously, he has emphasized the need to ensure that debts do not "default," project deliveries are not "abandoned," and development does not become "stagnant."
As 2025 approaches, conditions have not improved. From January to June, its total revenue was only HKD 1.976 billion, a year-on-year drop of over 60%, with a net loss of HKD 580 million. Fortunately, the management team has maintained a focus on stability. In September 2024, He Jianbo mentioned that even during peak periods, they would control risks rather than pursue excessive land acquisition or leverage beyond their capacity. In the first half of the year, He Jianbo's team signed a dim sum bond worth HKD 1 billion and successfully renewed a HKD 490 million revolving loan, reducing the scale of offshore loans and mitigating risk exposure.
As of the end of June, Minmetals Land had total assets of HKD 39.372 billion and net assets of nearly HKD 9 billion, with cash and bank deposits amounting to HKD 1.983 billion, temporarily stabilizing the situation.
As the delisting approaches, Minmetals Land has not shown complacency in its operations. During the National Day holiday, it hosted a variety of activities across its residential properties nationwide, such as M9 test drives, national trend carnivals, and fun park fairs to support the home-buying season. To adapt to the challenging real estate environment, it has also focused on commercial and property management sectors. In early May, Minmetals' light-asset strategy achieved success with the bidding for the Jinan Changqing Mingzhu Plaza commercial complex project, launching a development model of "management output + brand empowerment." At the same time, the Minmetals · Hashtart Town held a grand opening ceremony after investing millions in upgrades, integrating cultural experiences, leisure, vacations, and community living in this national 4A scenic area located in Huizhou, Guangdong.
By choosing to go private, Minmetals Land sees it as a new start. The management team, led by He Jianbo, pointed out in the announcement that delisting would facilitate long-term strategy implementation and enhance operational flexibility, allowing for a greater focus on long-term business planning and resource integration. Minmetals Land is also expected to break free from the constraints of capital market rules, simplify governance structures, reduce management and compliance complexity, and improve overall operational and decision-making efficiency. The market anticipates that the company will better leverage the resources of its parent company to weather the downturn. China Minmetals Group, its parent company, has business interests in mineral resources, metallurgical engineering, trade logistics, and financial real estate, generating annual revenues exceeding HKD 800 billion and total assets exceeding HKD 1.3 trillion. Earlier this year, the management team of Minmetals Land mentioned that the group would provide support when needed. In February, backed by the group, it obtained a HKD 1 billion three-year term loan financing.
There may also be other possibilities for internal integration. A decade ago, China Minmetals merged with China Metallurgical Group, packaging a real estate company—China Metallurgical Holdings, which has maintained independent operations alongside Minmetals Land. Speculation suggests that the integration of Minmetals Land and China Metallurgical Holdings could accelerate following the delisting.