Evergrande Group, a Chinese real estate conglomerate, announced Thursday it has purchased nearly 5 percent of the issued shares of China Vanke, China's largest home builder, complicating the lengthy struggle for control of the company.
Shares of China Vanke, a Shenzhen-listed property developer, climbed by the daily limit of 10 percent on Thursday.
After the stock market closed, Evergrande said in a statement that the company had spent over 9 billion yuan (1.4 billion U.S. dollars) on a total of 516,870,628 shares in Vanke, accounting for 4.68 percent of the company's issued shares.
According to Chinese law, if an investor acquires more than 5 percent of a listed company, it must make an announcement, notify the company, and file a written report to the China Securities Regulatory Commission and the stock exchange within three days. Trading in the company must be suspended until the investor fulfills its obligations.
Last year, the privately-owned Baoneng Group quietly bought a quarter of Vanke's shares and became its largest holder. Vanke chairman Wang Shi openly opposed the acquisition, calling Baoneng "barbarians" and expressing concerns over its credit score.
Vanke's original largest shareholder, state-owned conglomerate China Resources, became worried as its shares in the company fell to just 15 percent. Anbang Insurance Group also holds more than 6 percent of Vanke shares.
Evergrande's purchase sparked heated debate as it may change the balance in the much-anticpated battle for control of Vanke.
