New World Development Focuses on Debt Management Before Considering Mergers and Acquisitions
Debt Management Takes Precedence
In a recent meeting, New World Development (NWD) reaffirmed its commitment to managing its debt before pursuing any potential mergers and acquisitions (M&A). Chairman Henry Cheng Kar-shun highlighted that the company will not undertake any corporate actions that may jeopardize cash flow.
Strategic Financial Adjustments
- Recent management changes include the replacement of CEO Adrian Cheng Chi-kong by Eric Ma Siu-cheung.
- NWD currently holds HK$123.7 billion (US$15.9 billion) in consolidated net debt.
- The company has executed liability management exercises leading to over HK$16 billion in loan arrangements over the summer.
- Dividend payouts are suspended until debt levels are reduced significantly.
Market Position and Future Prospects
Despite reporting a HK$19.7 billion net loss for the year ending in June, NWD remains focused on financial recovery. Cheng declined suggestions to privatize New World Department Store China, indicating a preference for raising cash through alternative avenues such as asset sales.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.