Embattled property developer New World Development (17 HK) has proposed the spin-off and separate listing of a REIT on the Shanghai Stock Exchange.
The spin-off comprises the mixed-use property (comprising Shanghai K11 Art Mall and Shanghai K11 ATELIER NWT), one of NWD flagship PRC assets.
Trading at a trailing P/B 0.074x. That pretty much says it all. The impact from the spin-off, if completed, will be minimal. This remains an avoid.
The Trade:
I’d still avoid NWD.
This latest deleveraging proposal, if completed, will only make a modest dent.
In a normal world, the liquidators would have been called in by now.