Huishan Dairy aims to raise US$1.3b in IPO
The float of the mainland company, backed by Cheng Yu-tung, would be HK's biggest in months
China Huishan Dairy, in which Hong Kong business mogul Cheng Yu-tung has a roughly 25 per cent stake, plans to raise up to US$1.3 billion through a float in Hong Kong that is poised to be the city's largest initial public offering since June.
It plans to sell 3.79 billion shares at an indicative price range of HK$2.28 to HK$2.67 each, translating into an expected price-earnings ratio of 14.5 to 17 times next year's forecast earnings, a document seen by the South China Morning Post shows
The deal has captured at least three cornerstone investors - Yili Group, Cofco Agricultural and Norges Bank, which manages the Norwegian government's pension fund - to buy US$220 million of shares, representing about a 10th of the entire IPO.
The firm will begin a global roadshow today and take orders from institutional investors at the same time. Its shares were scheduled to be listed late this month, bankers involved in the deal said.
If successful, Huishan will join five dairy firms listed on the Hong Kong stock exchange - including China Mengniu Dairy and China Modern Dairy - which are trading on an average price-earnings ratio of 24, based on next year's forecast earnings, and a price-book ratio of 1.5 times.