PROPERTY giant City Developments Limited on Wednesday said it has appointed Deloitte & Touche Financial Advisory Services as its external financial adviser to assist in further evaluating and reviewing its investment in China-based Sincere Property Group.last month, citing disagreements with the board and management on the group's investment in Sincere, as well as its management of London-based unit, Millennium & Copthorne Hotels.
On Wednesday, CDL's board noted that it mandated the evaluation and review by Deloitte in view of the"challenges relating to Sincere's liquidity position" following the Covid-19 pandemic and"new measures to further tighten liquidity for real estate companies in China, the most recent being the 'Three Red Lines' policy".
In a bourse filing on Oct 21, CDL noted that its investments in Sincere totalled about S$1.9 billion. These include a 51 per cent joint-venture equity investment in Sincere amounting to 4.4 billion yuan . It had also subscribed for US$230 million worth of bonds issued by Sincere, and provided a working capital loan of 650 million yuan.
The investments also include a 1.5 billion yuan liquidity-support undertaking provided by CDL for Sincere's bonds maturing on Oct 26, 2020, as well as a 1.5 billion yuan corporate guarantee in relation to an external bank loan obtained by Sincere.