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today, midea real estate (03990.hk) fell by more than 60%, sparking heated discussions in the market.

according to the hong kong stock exchange, midea real estate opened at hk$3.02 that day, down about 60% from the previous day's closing price of hk$7.35 per share. as of press time, it was trading at hk$2.47 per share, with the decline widening.

overall, the huge fluctuation in midea real estate’s stock price may be mainly related to the company’s ongoing equity restructuring.

on the news front, on september 2, midea real estate held an extraordinary general meeting of shareholders using a combination of an on-site meeting and an electronic conference system. with the controlling shareholder giving up their voting rights, the restructuring plan was passed with a high vote support rate of 95%. after the restructuring plan is passed, the transaction will be officially completed on october 22.

according to the data, on june 23, midea real estate announced that the company would carry out equity restructuring and reorganize the wholly-owned real estate development business from the listed company to the controlling shareholder. if shareholders do not participate in the physical distribution of the real estate development business equity, they can choose an equal cash distribution. the cash distribution amount per share is hk$5.90.

note: midea real estate’s time-sharing chart is from the hong kong stock exchange website

previously, this high cash distribution had triggered a lot of funds to rush to buy shares of midea real estate for arbitrage. from june 24 to september 4, the share price of midea real estate doubled. on august 23, the company's chairman and president hao hengle also increased his holdings by 30 million shares, worth about hk$232 million.

however, it should be noted that according to the restructuring plan, september 5 is the final deadline for midea real estate to submit share transfers in order to meet the proposed distribution qualifications. this also means that after september 5, those who continue to hold midea real estate shares will not be able to obtain high cash distributions, which is also the main reason for the sell-off after the opening of today's market, leading to a huge shock in the company's stock price.

on the other hand,if cash distribution is taken into account, investors who previously held midea real estate are actually still in a floating profit state.

based on the current price of hk$2.47 per share of midea real estate, after adding the cash distribution of hk$5.90, it is actually equivalent to hk$8.37 per share, which is still about 14% higher than the previous day's closing price of hk$7.35.