Link Real Estate Investment Trust (SEHK:823) agreed to acquire 50% stake in Qibao Vanke Plaza in Shanghai from an Asia-based sovereign wealth fund for CNY 2.8 billion on February 24, 2021. As per the terms, Link Real Estate shall pay CNY 277 million (first payment) on fifth day of agreement, CNY 1.6 billion (second payment) on fulfilment of certain condition, CNY 200 million (Seller Tax Withheld Amount) on or before the fifth business day after the completion date and a differed payment of CNY 73.5 million. The consideration is subject to certain adjustment.

The consideration will be funded from existing cash and debt facilities of Link Real Estate. In case of termination seller shall pay 50% of CNY 277.2 million (first payment) as liquidated damages and vice versa. Pursuant to the transaction, three board of directors and two member of operation management committee of Qibao Vanke Plaza will be appointed by Link Real Estate.

The completion is subject to regulatory approval, the transfer of the equity interest, the amendments to the articles of association of the Target, and the appointment of the persons designated by the Link as the new directors, chairman, and supervisor of the Target having been duly registered with the relevant government authorities of the PRC. The transaction is expected to complete in March 2021. The acquisition is not expected to have any material adverse impact on the financial position of Link.

Zhong Lun Law Firm acted as legal advisor for Link Real Estate. Colliers International (Hong Kong) Limited acted as independent property valuer. Ernst & Young acted as Financial advisor and Due Diligence provider to Link Asset Management Limited.

Jeremy Ong , Edmond Chan and May Lau of Baker & McKenzie Hong Kong acted as legal advisor to Link Real Estate Investment Trust.