Sino-Ocean, KKR Invest $191M in Chinese Developer

The investment in Capital Juda marks the second partnership between the firms to expand their presence in China.
One of BCL's projects in Hong Kong

One of BCL’s projects in Hong Kong

Hong Kong—Chinese property developer Sino-Ocean Group Holding Ltd. and global investment firm KKR recently announced their definitive agreement to fuel the development of Beijing Capital Juda Ltd., a retail outlet developer and operator. The investment is possible through a combination of new ordinary shares and perpetual convertible bond securities for a total consideration of $191 million.

Capital Juda is a subsidiary of Beijing Capital Land (BCL), a Chinese real estate developer listed in Hong Kong and controlled by Beijing Capital Group. BCL and Beijing Capital Group completed the acquisition of Beijing Capital Juda in December 2013. The company plans to focus on integrated outlets projects across China. Following completion of the transaction, Sino-Ocean and KKR will own an approximate 16 percent and 12 percent stake in Capital Juda, respectively, on a fully diluted basis.

“Sino-Ocean and KKR are experienced investors in China’s real estate market and their investment in Capital Juda recognizes the future potential of China’s commercial real estate market, especially in the outlets sector. Combining their resources and extensive industry expertise with our experience in developing and managing outlets will bring along synergies to accelerate the development of the company’s business,” said Beichen Zhong, executive director & CEO of Capital Juda, in a prepared statement.

KKR is making its investment through its China Growth Fund. The transaction is subject to customary regulatory and Capital Juda shareholder approvals. The Hongkong and Shanghai Banking Corp. Ltd. is the exclusive financial adviser to Capital Juda.

Image courtesy of BCL