HONG KONG (Reuters) – Hong Kong property developer New World Development aims to focus on its debt load before any consideration of mergers or acquisitions, according to chairman Henry Cheng, the South China Morning Post reported (SCMP).
New World will not take on new corporate activities that could hurt its cash flow, SCMP cited Cheng as telling a shareholders’ meeting on Thursday, adding that the company’s priority for now is to reduce its debt.
New World had HK$123.7 billion ($15.9 billion) of consolidated net debt as of June 30, according to its latest financial report.
The developer, which has the highest debt among its Hong Kong peers and recently halted a dividend payout, is also managing its dividend and stock buyback policies to trim leverage, Cheng added.
In September, New World announced a change in management, with Eric Ma promoted to chief executive from chief operating officer, replacing Adrian Cheng, the third-generation scion of the firm’s founding family.
New World, which logged its first annual net loss in two decades for fiscal year 2023, has said it would dispose of non-core assets worth HK$13 billion and that it will not consider a rights issue.
($1 = 7.7825 Hong Kong dollars)