2010-03-19

Another China real estate policy targets SOEs

It's like they're serious or something.
SOEs Ordered to Check Out of Hotel Sector
Sources close to SASAC said the move is aimed at reorganizing and integrating state-owned hotels, transferring them to companies that can manage them more professionally. Ninety percent of the affected hotels are now run by "third-tier" subsidiaries of large SOEs.

Some industry experts said they were puzzled by the order, and wonder whether government agencies have unannounced interests in the divestments. Moreover, company officials at some hotels targeted for spin-offs are putting up resistance.

"To be honest, we don't know the true intentions behind SASAC's actions," said the head of one state-owned company. "Perhaps they will set up an asset management company so that they can operate the hotels themselves."
15-sec investment analysis: possibly mildy bad news for Home Inns (HMIN) and Jinjiang Hotels (2006.HK) if the assets are managed better, since it means more competition. If the assets are sold off, perhaps its bullish if they can acquire good properties. Not tradable news yet, either way.

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