Norton Rose Fulbright has advised China Overseas Land & Investment Limited (COLI), a Hong Kong-listed company, on its acquisition of a property portfolio from CITIC Group for US$4.8 billion (RMB31 billion).

The transaction represents the largest M&A in China’s property sector, and a major consolidation between two large-scale state-owned enterprises. HSBC is the financial adviser to COLI while CITIC Securities is the financial adviser to CITIC Group.

COLI is a leading property developer in China and is listed on the Hang Seng Index. CITIC is one of the largest state-owned conglomerates in the People’s Republic of China (PRC).

The transaction sees COLI agreeing to acquire CITIC’s property portfolio, which is largely residential, and has a total gross floor area of approximately 24 million square metres, located in 25 cities across China.

The total assets and net assets involved amounted to about RMB120bn (US$18.5 billion) and RMB20 billion (US$3 billion) respectively. The consideration of US$4.8 billion will be satisfied partly by issuing 10% of COLI enlarged share capital to CITIC and partly by transferring a portfolio of COLI properties to CITIC.

The Norton Rose Fulbright team was led by Hong Kong partner Psyche Tai, assisted by senior associate Doris Ng, and associates Timothy Lam and Jaycen Liao.

This is the second M&A transaction Norton Rose Fulbright has worked on for COLI after its acquisition of the US$5.5bn property portfolio of its parent company, China State Construction Engineering Corporation Limited, in 2015.