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Vanke, partners in talks to pay Blackstone $1.9 billion for property firms: Reuters

(Reuters) — China Vanke Co Ltd said it and partners are in talks to acquire some commercial property firms from Blackstone Group LP and other third parties for 12.9 billion yuan ($1.9 billion).

The disclosure is a more detailed response by Vanke, currently mired in a high-profile corporate power struggle, to enquiries from the Shenzhen bourse after criticism by its second-biggest shareholder that the board’s approval of a white knight deal was not valid as one director had abstained from voting.

Fearing a hostile takeover bid by its biggest shareholder, financial conglomerate Baoneng, Vanke’s management last month announced a $6.9 billion deal with Shenzhen Metro Group, which would dilute the holdings of Baoneng and China Resources.

The independent director in question, Zhang Liping, is employed by Blackstone and abstained from voting as he thought that approval of the Shezhen Metro deal could affect talks with Blackstone, Vanke has said, adding that this was within company rules.

The country’s largest listed property developer (000002.SZ) said in a statement it would spend about 3.9 billion yuan on the acquisitions but added that the financing of the deal would not entail the issuance of any securities.

Vanke did not identify its partners, the commercial property firms or the third parties that own the stakes with Blackstone.

Vanke representatives did not reply to requests for comment. Blackstone was not immediately available for comment outside of regular business hours.

The developer also said it has not entered into any legally binding agreement regarding the deal, which was approved by its board on June 21.

Baoneng this month nudged up its stake after a setback in its efforts to oust the property developer’s board, further fanning speculation of what would be a rare hostile takeover bid for a mainland Chinese company.