HONG KONG -- Property developer Central China Real Estate Ltd. has secured a US$99 million investment in a deal led by private-equity firm FountainVest Partners that bets on rapid growth in China's second-tier cities.
Investors greeted the infusion of capital by sending Central China Real Estate's shares almost 9% higher Wednesday to close at 2.60 Hong Kong dollars (about 34 U.S. cents).
Chinese property stocks have rebounded sharply this year as Beijing pumped money into the economy to fight a slowdown. Analysts say a flood of cheap bank loans is fueling housing sales and pushing up land prices.
Since the start of the year, Central China Real Estate's shares have more than tripled, but they still remain below their initial offering price of HK$2.75 in June 2008, when the company raised US$176 million amid rocky market conditions.
