Shares of Soho China, a real estate company run by a prominent power couple, fell by one-third on Monday after Blackstone Group walked away from its deal to buy the firm.
Soho China said in a joint filing late on Friday that Blackstone would not go through with its $3 billion bid for a controlling stake in the company, without giving a reason. Blackstone, the Wall Street investment giant, and Soho China declined to comment further on Monday.
The company is controlled by Zhang Xin and Pan Shiyi, a married couple who share the title of executive director. Mr. Pan, who is chairman, was one of the first Chinese entrepreneurs to use social media for public relations and has tens of millions of followers online. Ms. Zhang is well known in part for her role in a 2013 deal to buy a stake in the General Motors Building in Manhattan.
The news comes as China’s most successful business tycoons come under scrutiny and growing pressure to share more of their wealth. The deal, which would have been among the real estate sector’s biggest, was announced in June, with a regulatory review pending. It was seen as a move by the husband-and-wife team to reduce their exposure to China.
A deal for Soho China could have also shored up confidence in the country’s real estate sector, which, after years of remarkable growth, is coming under greater regulatory scrutiny as Beijing tries to put a stop to corporate binge borrowing. Developers have been forced to start paying off mounting bills under new central bank rules, called the “three red lines.”
Evergrande, China’s biggest developer, has spooked investors, home buyers and experts who are predicting a bankruptcy in the near future.
In recent weeks, real estate prices and demand in some of China’s biggest cities has started to weaken. A prominent Beijing think tank last week said the sector had “shown signs of a turning point.”
Real estate woes, plus reports of greater regulatory tightening in mainland China, contributed to a drop of nearly 2 percent in Hong Kong shares on Monday.
More than 500,000 student borrowers — with nearly $10 billion in student loan debt — had their loans erased this year, Stacy Cowley reports for The New York Times.
President Biden has so far fended off calls for the kind of blanket debt cancellation that is a top priority of many progressive lawmakers, but a parade of relatively modest eligibility and relief enhancements adds up to a significant expansion of support for beleaguered borrowers. And more may be coming: The Education Department said it was planning regulatory changes to programs aimed at helping public servants and those on