The week did not start on a good note for high-profile Chinese couple Pan Shiyi and his wife Zhang Xin, who currently control Soho China Ltd.(HKG: 0410), a Chinese commercial property developer, as company shares came down 35% on Monday. It is reported that a sale deal between U.S. private equity giant Blackstone Inc. (NYSE: BX) and the Chinese commercial property developer did not materialize. The takeover deal, reportedly valued at $3.3 billion, did not take shape as planned owing to a lengthy regulatory review, forcing the agreement to drop.
The duo continue to face criticism on home turf
The husband-wife duo, Pan Shiyi and his wife Zhang Xin, faced criticism in China since the deal was announced in June. Despite this, there were assertions that the couple began putting money together and were preparing to move money abroad. However, as the agreement failed to take shape as planned, the high-profile entrepreneurs faced wrath on home soil. The Chinese company with plush office blocks in Beijing and Shanghai also has properties designed by global ace architects like the late Zaha Hadid and the likes.
The deal was called off as no progress was made in the targeted period
The U.S. private equity giant Blackstone and the Chinese commercial-property developer said that the sale deal was called off as they failed to make enough progress within the targeted period. Meanwhile, Arun George, an analyst at Global Equity Research Ltd. who also publishes on the Smartkarma platform, stated that the sale deal does not coincide with President Xi Jinping’s latest calls for wealth redistribution. The Chinese President plans to encourage social equality and aims at distributing wealth more evenly. These sentiments have not gone down well with business tycoons who have amassed fortunes in the last few decades.
The couple who founded the Beijing-based commercial property development firm in 1995 at present are owners of close to a 54% stake in the company. The property development firm grabbed media attention in 2019 when Bloomberg reported its plans of considering selling a significant chunk of its commercial property holdings. Critics echoed the opinion stating that the company is attempting to offload assets in China.
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