KE Holdings Enters Deal to Acquire Shengdu Home Renovation
KE Holdings (BEKE) has inked a deal to acquire 100% stake in Shengdu Home Renovation Co. Ltd., a full-service home renovation service provider in China. The purchase price has been capped at RMB8 billion, consisting of cash and equity. The deal is expected to close in the first half of 2022.
KE Holdings is a China-based company that operates an integrated online and offline platform for housing transactions and services.
As per the terms, KE Holding will initially acquire certain equity interests in Shengdu. Following this, upon satisfaction of certain performance target criteria and other customary closing conditions, acquisition of the remaining equity interests will be done. (See KE Holding stock chart on TipRanks)
The chairman of the board and CEO of KE Holdings, Stanley Yongdong Peng, said, “With 20 years of operating experience…, we have gained profound understanding on how to establish new and higher standards…, and we believe our proposed acquisition of Shengdu will enable us to strengthen our capabilities in providing better housing services to satisfy the evolving needs of housing customers.”
Founder of Shengdu Weiyang YAN said, “We believe the transaction would enable both companies to realize strategic synergies across the industry chain, and thus provide a more joyful living for the housing customers in China.”
Two months ago, Nomura analyst Leif Chang reiterated a Buy rating on the stock with a price target of $94.85 (upside potential of 102.5%). Chang expects KE Holdings to post earnings per share of $0.96 in Q2.
Consensus among analysts is a Strong Buy based on 3 Buys and 1 Hold. The average KE Holdings price target of $70.46 implies upside potential of 50.4% from current levels.
TipRanks data shows that financial blogger opinions are 100% Bullish on BEKE compared to the sector average of 69%.
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