HONG KONG (Reuters) - CIFI Holdings on Tuesday became the latest Chinese property developer to raise funds by selling new shares at discounted prices, while Agile Group announced its second such capital raising since November.
After a raft of government measures supported their share prices, a number of developers including heavyweights like Country Garden have since November turned to top-up share placements.
The method, in which a controlling shareholder sells existing shares and then the company issues the same amount of new shares to them, allows funds to be raised without any large dilution in stake for the controlling shareholder.
Shanghai-based CIFI, which is undergoing an offshore debt restructuring, said it would raise HK$957.6 million ($123 million) by selling shares at HK$1.14 apiece, a 14% discount to Monday's closing price.
Guangzhou-based Agile said it would raise HK$617.2 million ($79.3 million) by selling shares at HK$2.32 apiece, a 17.4% discount to Monday's closing price. It is the second top-up placement for Agile since November when it raised HK$783 million.
The companies, which saw their shares slide in line with the discounted share sale prices, said they would use the proceeds to repay existing debt.
China's property sector has over the past one and a half- years been grappling with a severe debt crisis - initially triggered by government moves to rein in ballooning debt - with many developers defaulting as they struggle to sell apartments and raise funds.
($1 = 7.7837 Hong Kong dollars)