If any further proof were needed of the vigour of the “new silk road” – the thriving trade route between the Middle East and China – it will come in the form of a fund-raising visit to Dubai of Canton Properties, a Hong Kong company listed on the London Alternative Investment Market (AIM.)
Canton wants to raise some $230 million (Dh844m) to finance the purchase of prime property in Guangzhou, one of the cities booming in the Chinese economic miracle.
The usual sources of funding – Singapore, London, US offshore investors – were initially considered, but the company has decided to include Dubai in the list of potential investors because of the emirate’s fast-growing reputation as a centre for global finance.
The cash will be used to purchase a prime development site in Guanzhou, on the Pearl River New City area, which is earmarked as the city’s new business district.
Guangzhou is seen as a centre with great potential – like Shanghai or Beijing but without the sky-high property valuations. The property is worth some $1.2 billion, according to property experts Knight Frank.
Canton, under US-trained Chief Executive Charlie Lin, already operates two malls in the city, and has a long-term alliance with the Guangzhou metro authority, which virtually guarantees it natural footfall at its developments. The similarities with Dubai in this respect are striking.
Canton has been one of the success stories of the wave of Chinese companies that have listed on the AIM market. Floated last summer at 44p per share, it is now valued at 97p, despite the turbulence that has hit stock markets, especially for property-related shares.
The Dubai leg of the secondary fundraising will begin at the weekend, advised by the Libertas investment group. It could be the first step towards an eventual listing in Dubai.
230: The amount in million dollars Canton wants to raise to finance purchase of property
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