With the gradual relaxation of credit lines, real estate mergers and acquisitions have begun to heat up. A market is also beginning to open up to private enterprise.

In early March, Country Garden and Midea Real Estate signed strategic cooperation agreements of 15 billion yuan and 6 billion yuan respectively with China Merchants Bank. M & a financing line dedicated to real estate mergers and acquisitions. A business, including but not limited to mergers and acquisitions; loans, mergers and acquisitions. a Funds, asset securitization and innovative financing products derived from mergers and acquisitions; a-Related business needs.

These two real estate companies have also become the first private real estate companies to obtain M&A financing lines. Post-merger loans. a loans are no longer included in the "three red lines" indicators. Previously, Mampa funds were mainly supported by central enterprises and state-owned enterprises.

Real estate mergers and acquisitions. a. Loans are open to private housing companies

Guosen Securities believes that Country Garden can obtain a 15 billion acquisition; a. The financing limit is because the company has stable operations, high credit quality, and smooth financing channels. As a high-quality leading real estate company, it benefits from policy guidance and shows its financing advantages. It is understood that as of mid-2021, its average financing cost is 5.39, its cash to short-term debt ratio is 2.1, its cash liquidity is strong, and the company's short-term debt repayment ability is strong.

As for mergers and acquisitions. After obtaining the financing line from the bank, Country Garden said it would establish an in-depth strategic partnership with China Merchants Bank in real estate mergers and acquisitions. a financing. The development of Country Garden M&A. A business will be fully supported to better navigate mergers and acquisitions. Opportunities in the market.

Although the amount of financing for M&A a is not as high as that of Country Garden, the leading real estate company, Midea Real Estate, which also received the same amount of financing, took the lead in M&A; a. Carry out activities long before obtaining financing. According to Tianyancha information, on February 23, Midea Real Estate took over the equity of Tianjin Xiqing and Jiangzhumei Residential Project 51 from Zhengrong Real Estate, so Midea Real Estate became the sole shareholder of the project.

The merger and acquisition channels of the above two private enterprises. The financing limit is related to the gradual relaxation of the credit limit. In December last year, the central bank and the China Banking Regulatory Commission issued the "Notice on Providing Financial Services for Mergers and Acquisitions of Risk Disposal Projects of Key Real Estate Enterprises" and launched financing support for real estate mergers and acquisitions. The core of this policy is to encourage commercial banks and the inter-bank market. Actively provide financial services, namely loans and bonds, to support such mergers and acquisitions.

Due to the restrictions of the three red lines, similar pressure on mergers and acquisitions still exists. Until January 2023, market reports stated that M&ampa loans will no longer be included in the "three red lines" indicators. The continuous loosening of policies has strengthened the motivation for corporate mergers and acquisitions.

On January 17, 2023, Shanghai Pudong Development Bank plans to issue 5 billion bonds for mergers and acquisitions; loans, this is the first merger and acquisition. Real estate project a-themed bonds issued by financial institutions. With the active efforts of financial institutions. a Financing has gradually begun to flow into the market.

From China Merchants Shekou, to China Resources Land, and then to Country Garden, the list of supported real estate companies has gradually expanded, and the supported real estate companies have gradually expanded from central enterprises and state-owned enterprises to private enterprises.

On the same day the above two private companies accepted the merger. With the financing line granted by the bank, Fuzhou Vanke obtained the merger. Industrial Bank has loaned nearly 3 billion yuan to support Fuzhou Vanke in replenishing funds for projects under construction through equity acquisitions, overall transactions, etc. This merger. Loans are also seen as a signal to support real estate mergers and acquisitions. a started to be more targeted.

Policies tend to support high-quality real estate companies in acquiring high-quality projects from large real estate companies with risks and difficulties, but can this pull risky companies out of the quagmire?

Improvement of the financing environment for real estate companies

This is a microcosm of the merger and acquisition of real estate by private enterprises. a loan. In March, the financing side of real estate companies began to feel warm.

In the past February, according to data from CRIC Research Center, the total financing of 100 typical real estate companies in February 2023 was 39.817 billion yuan, a month-on-month decrease of 58.9 and a year-on-year decrease of 58.8. The amount of financing hit a new low since January 2018.

At the same time, Kerui believes that

On March 1, Country Garden announced that Country Garden Real Estate planned to issue medium-term notes with a total principal amount of RMB 5 billion in China. Registration; on March 2, according to the Shanghai Stock Exchange, Rongsheng Holdings planned to issue ultra-short-term financing bonds of no more than 1 billion yuan with a term of 270 days; on the same day, Beijing Housing and Construction Group's 1.6 billion yuan renewable corporate bonds were accepted.

From the perspective of financing investment, except for Country Garden, which plans to use the raised funds for company project construction to further help the company's stable operations, most of the funds raised by other real estate companies will be used to repay maturing bonds and bank loans. Supplement the company's daily operating liquidity.

In fact, March is also the peak period for real estate companies to repay debts. According to statistics from the Kerrey Research Institute, from March to June this year, approximately 180.9 billion yuan in bonds from 170 real estate companies matured. Specifically, March is the month when corporate bonds mature, totaling approximately 58.9 billion yuan, accounting for 32.6% of the total maturing bonds in the first half of the year.

The pressure on real estate companies to repay debts is still there, but with the recent favorable policies, real estate companies are frequently issuing bonds, and the real estate financing environment is also improving at the margin. Ding Zuyu, CEO of E-House Enterprise Group, said that recently, the normal financing needs of some real estate companies have been gradually met, and bond issuance by real estate companies has shown a rebound.

It is worth mentioning that on March 2, the Henan Real Estate Association issued the "Notice on Statistically Reporting the Financing Needs of Development Enterprises (Projects)", planning to launch special bank-enterprise docking in the real estate field. According to the requirements of the Provincial Department of Housing and Urban-Rural Development, statistics on the financing needs of development companies (projects) are aimed at creating a better business environment for real estate companies.

“Similar operations are available in many cities, and some municipal governments will take the lead in matching, while Henan does it from the perspective of each province.” Yan Yuejin, research director of the Think Tank Center of the E-House Research Institute, believes that this The policy clarifies the implementation of the bank-enterprise docking policy, provides better protection for the financing side of real estate companies, and has a positive effect on subsequently improving the financial status of real estate companies and activating their operating activities. Related questions and answers: