China Vanke Announces Proposed RMB3.27 Billion Disposal of Subsidiary Huanshan Group

Key Highlights

• China Vanke Co., Ltd. plans to dispose of a significant non-core asset—99.41% equity interest in Huanshan Group Co., Ltd.—via a public tender on the Shenzhen Assets Exchange. The minimum aggregate bidding price is set at RMB3.27 billion.
• The disposal aligns with Vanke’s strategy to focus on its core property development and management business and withdraw from non-core, capital-intensive sectors such as agriculture and pig breeding.
• Upon completion, Huanshan Group will no longer be a subsidiary of Vanke, and its financial results, assets, and liabilities will be deconsolidated from Vanke’s accounts.
• The disposal is expected to result in a net profit reduction of approximately RMB948 million for Vanke (based on the minimum bidding price and subject to audit), but will significantly enhance Vanke’s liquidity and working capital.
• The transaction could be classified as a discloseable transaction under Hong Kong Listing Rules, subject to certain calculations and pending approval by the Stock Exchange.
• The public tender process ensures market-based price discovery and transparency. The identity of the buyer is currently unknown.

Details of the Proposed Disposal

The Vendors—comprising Zhuhai Qinshan Jiaye, Weihai Heda, Weihai Shuonong, Weihai Chunhe, Weihai Muda, and Weihai Xinmu, all indirect subsidiaries of Vanke—will sell their 99.41% stake in Huanshan Group through a public bidding process at the Shenzhen Assets Exchange. The minimum aggregate bidding price is RMB3.27 billion. Vanke will announce the final bid price once it is available.

The transaction is structured to maximize price discovery and transparency, with the final terms dependent on the outcome of the competitive tender. If the winning bidder is a connected person, Vanke will comply with additional disclosure and approval requirements under the Listing Rules.

About Huanshan Group

Huanshan Group, incorporated in the PRC in 2004, is primarily engaged in pig breeding, feed production and sales, poultry farming, and egg sales. Financially, Huanshan reported net profits (after tax) of RMB656 million (2024) and RMB450 million (2025). The book value and appraised value of the equity attributable to Huanshan’s parent company shareholders as of 31 December 2025 were RMB2,676.54 million and RMB3.24 billion, respectively.

The valuation for the transaction is based on an independent professional valuer’s report using the market approach, underpinning the minimum bidding price.

Strategic Rationale and Impact

The divestment of Huanshan is part of Vanke’s ongoing strategy to refocus on its core property business and exit non-core, capital-intensive sectors. The company cites limited alignment with its main operations and challenging sector economics as reasons for the disposal. The proceeds will be used to enhance working capital, strengthen the Group’s financial position, and improve overall financial flexibility.

While the disposal will result in a one-time reduction in net profit (estimated at RMB948 million), management believes this is offset by the improved liquidity and resource allocation for long-term value creation.

Regulatory and Listing Rules Implications

The transaction is subject to the Hong Kong Listing Rules. Vanke has applied to the Stock Exchange for special consideration regarding the calculation of the “profits ratio,” as standard calculation methods may produce anomalous results. If approved, the disposal will be classified as a discloseable transaction (one or more applicable percentage ratios exceeding 5% but less than 25%), triggering announcement and reporting obligations. If not approved, Vanke will follow all further required disclosure and approval protocols.

What Shareholders Need to Know

• The disposal will remove a profitable but non-core and capital-intensive business from Vanke’s consolidated accounts.
• There will be a negative impact on reported net profit in the short term, but the move is aimed at long-term financial health and strategic focus.
• The transaction proceeds will be used to strengthen liquidity, which is critical given the property sector’s current challenges.
• The final outcome of the public tender and the buyer’s identity may impact Vanke’s future business relationships and regulatory compliance obligations.
• The transaction is material and price-sensitive, as it directly affects the company’s balance sheet, profit statement, and strategic direction.

Conclusion

The proposed disposal of Huanshan Group marks a significant strategic shift for China Vanke, with important implications for its financial structure, operational focus, and share value. Investors should monitor subsequent announcements regarding the final bid price, the identity of the buyer, and regulatory decisions, all of which could influence Vanke’s stock performance in the near term.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investors should conduct their own due diligence and consult professional advisors before making any investment decisions. The information is based on public disclosures by China Vanke Co., Ltd. as of 29 April 2026 and may be subject to change.

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