The share price of China Aoyuan Group Limited (03883.HK) doubled today, with its market value surging nearly HKD 500 million. This rise is mainly attributed to the equity changes announced by the company on September 20, with UAE investment institution Multi Gold Group Limited becoming its strategic investor. According to the announcement, Multi Gold acquired approximately 622 million ordinary shares from Ace Rise Profits Limited, controlled by the company's founder Guo Ziwen. Following this transaction, Mr. Alobeidli, the sole director and beneficial owner of Multi Gold, will assume the role of non-executive director and chairman of the board at China Aoyuan.
Meanwhile, Mr. Guo Ziwen's shareholding decreased to 16.38%, and he is no longer the controlling shareholder of the company, having stepped down from the position of chairman of the board. Despite the influx of Middle Eastern investment and the resulting stock price surge, China Aoyuan still faces financial difficulties. The company reported a full-year loss of CNY 9.641 billion in 2023, with a shareholder-attributable loss of CNY 9.534 billion. However, due to the impact of overseas debt restructuring, the company reported a profit of CNY 22.1 billion in the first half of this year, indicating a slight improvement in its operating conditions.
Despite this, whether China Aoyuan can successfully turn the situation around with the involvement of the Middle Eastern investors remains to be seen by the market.
