Li Ka-shing’s Hutchison Port Holdings Trust expects to raise US$5.4 billion ($6.9 billion) in Southeast Asia’s biggest initial public offering, according to three people with knowledge of the transaction.
The company, which manages Chinese port assets for billionaire Li’s Hutchison Whampoa, plans to sell about 5.4 billion units in a trust at US$1.01 each, after offering them at 99 cents to US$1.03, said the people, who declined to be identified before an announcement.
The company, which manages Chinese port assets for billionaire Li’s Hutchison Whampoa, plans to sell about 5.4 billion units in a trust at US$1.01 each, after offering them at 99 cents to US$1.03, said the people, who declined to be identified before an announcement.
Hutchison Port’s sale will likely surpass the US$4 billion raised in Singapore Telecommunications Ltd.’s 1993 IPO, previously the city-state’s largest, and Petronas Chemicals Group Bhd.’s US$4.1 billion initial offering in November in Malaysia. Asian companies are struggling to raise the maximum amount sought in IPOs after stocks in the region fell this year.
The units were initially offered at 91 cents to US$1.08 each before the price range was narrowed. DBS Group Holdings, Deutsche Bank AG and Goldman Sachs Group Inc. are managing the sale. Hutchison Whampoa spokeswoman Laura Cheung wasn’t immediately available to comment.
Investors are cooling on Asian equities as unrest in the Middle East pushes oil prices higher and accelerating inflation from China to India prompts central banks to boost borrowing costs. The MSCI Asia Pacific Index has slipped 2% this year after gaining 14% in 2010.
CORNERSTONE HOLDERS
China Hongqiao Group, the country’s largest privately owned aluminum producer, in January scrapped a plan to raise as much as US$2.2 billion from a Hong Kong IPO, citing “deterioration in market conditions,” according to a Jan. 31 filing to the city’s stock exchange. China Kingstone Mining Holdings will sell stock in Hong Kong at the low end of a price range, according to a term sheet for the deal.
Companies have sold US$2.8 billion of IPO shares in the Asia-Pacific region this year, compared with US$18.5 billion in the first quarter of 2010, data compiled by Bloomberg show.
Hutchison Port Holdings Trust will own assets including container terminals in Hong Kong and neighboring Guangdong province. Hutchison will manage the trust and retain a 25% stake, according to a Jan. 18 statement.
Cornerstone investors led by Capital Research & Management Co. and Paulson & Co. will invest US$1.62 billion in the IPO, according to the prospectus filed with the Monetary Authority of Singapore.
Capital Research will invest US$634 million in the offering, according to the term sheet. Paulson & Co., managed by John Paulson, will buy a US$350 million stake and Lone Pine Capital LCC will invest US$186 million, it said. Jenkin Hui and family, Singapore’s state investment company Temasek Holdings, Cathay Life Insurance Co. and Metropolitan Financial Services will each invest US$100 million, and Ally Holding will buy a US$50 million stake.
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