Private equity firm Hony Capital agreed to buy a $246-million stake in Shanghai Jin Jiang International Hotels Development, the hotel company said on Thursday.
Hony Capital, which manages approximately $7-billion, will buy 100 million shares in Shanghai Jin Jiang at $2.45 a share, a 23 percent discount to the company's closing price on Thursday of $3.18. That will give Hony Capital a 12.43 percent stake in Shanghai Jin Jiang, making it the largest institutional investor in the hotel company.
The deal comes amid growing private equity interest in China's property developers and managers, as their sources of capital tighten. The deal has approval from China's commerce ministry, but still needs a green light from China's securities regulator.