Soho China Ltd.’s (410) purchase of stakes in a land venture on Shanghai’s historic Bund was invalidated by a municipal court today, a decision the Chinese developer says it plans to appeal.
The Shanghai court ordered the return of the stakes in Zendai Wudaokou and Greentown Hesheng to the sellers, Shanghai Zendai Property Ltd. (755) and Greentown China Holdings Ltd., according to a statement made by the developer to the Hong Kong stock exchange. Beijing-based Soho China and the sellers will appeal against the decision at the Higher People’s Court of Shanghai, it said.
Fosun International Ltd. (656) had sued last year over the stakes, claiming it had pre-emptive rights to them. The Shanghai-based company with investments in property, mining and drugs, owns the rest of the 45,472 square meters (489,460 square feet) site.
Fosun respects the ruling and also respects the other parties’ right to appeal, the company said in an e-mailed response to queries. We believe that the law is fair and will continue to defend our legal rights, according to the statement.
Soho had agreed to pay 4 billion yuan ($648 million) for the stakes in December 2011. Developers in China have been selling land and other assets for cash amid government efforts to cool housing prices and clamp down on speculation.
Soho China fell 0.2 percent to HK$6.75 as of 3:23 p.m. in Hong Kong trading. Zendai Property retreated 2.7 percent to HK$0.146, while Greentown (3900) shares rose 2.7 percent to HK$15.22. Fosun jumped 4.5 percent to HK$5.34.
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