Longfor Group Holdings Ltd. is considering an initial public offering for its property management business in Hong Kong that could raise as much as $1 billion, people with knowledge of the matter said.
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The people said that the Chinese real estate developer is working with China International Capital Corp., HSBC Holdings Plc and JPMorgan Chase Co. on the proposed first-time share sale. The people said that the information could be accessed as it is private, so the listing could take place as soon as the first half of 2022.
Details, such as timing and fundraising size, could be changed, the people said. Representatives for CICC, HSBC, JPMorgan and Longfor didn't want to make a statement.
Longfor's shares rose by as much as 3.1% in Hong Kong on Wednesday, touching their highest intraday level since July 27.
Longfor is weighing a separate listing at a time when Chinese developers are facing an unprecedented liquidity crisis and housing prices and sales have begun to slide. In September, new home prices fell -- the first drop in six years -- and continued to slump in October, according to National Bureau of Statistics figures.
The Chinese real estate developers are the least affected by the crunch, according to the Beijing-based company. Its shares have declined by nearly 12% in the year to date, only the eighth largest fall on Bloomberg Intelligence's China Real Estate dashboard. The largest is China Evergrande Group, whose shares fell 80% this year.
Longfor would join a slew of Chinese developers who would take similar businesses public. In an exchange filing this month, China Vanke Co. is planning to list its property service unit in Hong Kong. The country's biggest developer by market value could raise $2 billion in an IPO of the unit, according to Bloomberg News in April.
Longfor s businesses include residential and commercial real estate and rentals, which was founded in Chongqing in 1993. Its Longfor Smart Service unit, started in 1997, serves over 3.6 million household owners in a contracted service area of 480 million square meters.
In the first half of this year, the company s interim report said that the company s property management and related smart services revenue jumped 58% year-on-year to around 4 billion yuan $626 million.
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