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Two mainland firms are launching an initial public offering (IPO) in Hong Kong to raise a combined amount of as much as HK$893 million (US$114 million), the latest move by mainland companies to raise money to fuel their development.
Analysts said more mainland firms would try to go public in Hong Kong by the end of this year to circumvent stricter listing requirements that will reportedly be put in place starting from next year.
China Haisheng Juice Holdings Co Ltd (China Haisheng) is expected to raise HK$311 million (US$40 million) at most by offering 305.55 million shares at an indicative price ranging from HK$0.82 to HK$1.02 per share.
The company closed its public offering on Friday and is working on determining the price. The debut is scheduled for this Thursday.
China Haisheng started to manufacture and distribute apple juice in 1996, with target markets covering 30 countries, including the United States, Canada, Australia, France and Japan. According to official data, Haisheng exported 84,725 tons of apple juice in 2004, accounting for 17 per cent of the country's total exports.
Meanwhile, machine manufacturer China Infrastructure Machinery Holdings Ltd (CIMH) is also offering a total of 300 million shares with a price range between HK$1.51 and HK$1.94 per share, to amass as much as HK$582 million to fuel its growth.
CIMH said yesterday that the company will prolong the offering period due to the recent weakening market environment. The company declined to release the new listing schedule, saying the original plan to start trading tomorrow had also been aborted.
Established in 1993, CIMH is principally engaged in the design, manufacture and sale of wheel loaders and is currently the third largest wheel loader manufacturer in China in terms of sales.
China Haisheng and CIMH are medium-sized private companies with a turnover of 550 million yuan (US$68 million) and 2.1 billion yuan (US$260 million) respectively in 2004.
"Mainland firms, small and medium-sized ones in particular, will speed up to go public in Hong Kong by the end of 2005, before the Hong Kong Stock Exchange tightens the listing requirements," said Andes Cheng, associate director with South China Research Ltd.
(China Daily November 1, 2005)
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