CHINA Vanke Co. plans to issue new shares to acquire a company as the managers of China’s largest property developer wage a struggle for control against its largest shareholder.

    The Shenzhen and Hong Kong-listed firm is looking at acquiring a company in a share and cash deal and it plans to issue new A shares or H shares. Vanke said Tuesday in a statement that it had entered into a letter of intent but did not name the company or the owner of the firm.

    The price will be decided after due diligence and the transaction may not be completed, the Shenzhen-based company said. Vanke didn’t say how many shares it will issue or what assets it plans to buy.

    Vanke is locked in a high-profile battle with Baoneng Group, a property and insurance conglomerate that became its biggest shareholder after buying a stake of more than 20 percent via unit Shenzhen Jushenghua Co. and affiliate Foresea Life Insurance.

    Vanke president Yu Liang said earlier this month that Vanke faces a “hostile takeover” from Baoneng. Vanke chairman Wang Shi has said Baoneng lacks credibility and would damage Vanke. Baoneng has responded that it has a good reputation and has strictly abided by the law.

    Vanke’s announcement Dec. 18 that trading was being suspended pending the release of information about a share sale had prompted speculation it was seeking to dilute Baoneng’s ownership.

    The letter of intent will terminate if the two sides fail to reach a written agreement on the transaction before June 30, according to Vanke’s statement Tuesday.

    The acquisition will be made with either Vanke’s shares traded in Hong Kong or Shanghai and in cash, Vanke said.

    The shares will continue to be suspended as the company is also in talks with other parties, the company said, without giving details. (SD-Agencies)