The firm sold 45 million shares at a six to eight per cent discount on the company’s closing price on Wednesday according to local media reports.
Warburg had cut its stake in Greentown to 4.86 per cent in 2009 by selling 4.5 million shares.
Zhejiang province-based Greentown has extended its business into cities including Shanghai, Nanjing and Beijing and rural areas of other provinces following the launch of its national expansion strategy in 2000.
Warburg, a regular investor in China, could sell its stake in budget hotel chain 7 Days group after it received a take-private offer from a consortium including Carlyle, Sequoia Capital China and existing shareholders.
The offer prices Warburg’s 16 per cent holding at $101m, which would represent a huge payout on the $20m it invested in 7 Days in 2006.
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