THE parent of Hainan Island Construction Co. is injecting a property unit into the Shanghai-listed developer in a transaction valued at 26 billion yuan (US$4.1 billion).

    Hainan Island will buy the unit with 2 billion yuan in cash, with the remaining 24 billion yuan coming from a share sale to a unit of its controlling holder, HNA Industrial Holding Co., according to a filing to the Shanghai Stock Exchange yesterday.

    HNA Industrial is an infrastructure investment vehicle of aviation operator HNA Group.

    Hainan Island plans to sell 2.25 billion shares at 10.67 yuan each to HNA Industrial, it said. That’s a 34 percent discount to the price June 1, the last time the stock traded before being suspended. The shares remained suspended from trading yesterday. A measure of property stocks in the Shanghai Composite Index dropped 27 percent in the period.

    After the transaction, Hainan Island is expected to become a leading infrastructure investor and operator, according to the statement. Armed with newly acquired land bank in southern Hainan Province, it will invest and develop a variety of infrastructures, including ports, roads and airports, it said.

    The builder also plans to raise as much as 16 billion yuan in another private placement to no more than 10 investors. That sale will be at 12.95 yuan a share. Morgan Stanley Huaxin Securities is advising on the transaction, according to the statement. (SD-Agencies)