China Youran Dairy Group Ltd., a derivative of dairy large Interior Mongolia Yili Industrial Group Co., is in search of to lift as a lot as HK$6.2 billion ($799 million) in a Hong Kong preliminary public providing (IPO).
The corporate and personal fairness agency PAG are promoting 715 million shares at a instructed providing worth vary of HK$6.98 to HK$8.66 a share, 10% of which might be bought in Hong Kong and 90% globally, in accordance with a prospectus filed with the Hong Kong Inventory Change.
Buyers can order shares beginning Monday, and the providing is predicted to be priced June 10. The inventory is about to start buying and selling June 18.
On the excessive finish of the instructed providing worth vary, the dairy firm could be valued at HK$32.87 billion, in contrast with about HK$13.2 billion for its fundamental rival China Trendy Dairy Holdings Ltd., a subsidiary of China Mengniu Dairy Co.
On the excessive finish of the anticipated providing worth, Youran Dairy would have a 17.7 price-to-earnings ratio, the very best amongst Hong Kong-listed Chinese language diary producers.
Hong Kong’s new listings are monitoring at a gradual tempo. The latest providing, property supervisor Central China Administration Co., dropped 12% on its debut final week, whereas the $3.2 billion IPO of JD Logistics Inc., the warehouse and delivery arm of e-commerce large JD.com Inc., priced towards the decrease finish of its marketed vary final month.
Youran Dairy’s share sale attracted two cornerstone buyers, Citic Prudential and Harvest Personal Wealth, which agreed to subscribe for about HK$388 million of shares, primarily based on the mid-point of the value vary, the prospectus exhibits.
The corporate plans to make use of 75% of the proceeds for funding initiatives within the subsequent two years, together with ongoing building and new pastures; 15% shall be used to buy cows; and the remainder shall be for common enterprise functions.
Based in 1984, Youran Dairy produces and sells recent milk and engages in associated animal farming actions in Interior Mongolia. It was an entirely owned subsidiary of Yili till Hong Kong-based personal fairness agency PAG invested in 2015.
PAG holds 42.9% and Yili 40% of the enterprise. After the IPO, PAG’s stake shall be diminished to 31.5%, and Yili’s to 34.8%. PAG additionally owns convertible debt of the corporate. If transformed, it might personal 40% of the corporate, leaving it the controlling shareholder.
Youran Dairy recorded a web revenue of 1.54 billion yuan ($241 million) in 2020, up from 801.9 million yuan within the earlier yr, in accordance with its prospectus. Yili is its greatest shopper, contributing about 57% of income final yr.
Huatai Worldwide and Credit score Suisse Group AG are joint sponsors for the itemizing.
Contact reporter Denise Jia ([email protected]) and editor Bob Simison ([email protected])
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