Companies pile into market in $2b flurry
ACC Acoustic Technologies, Hong Kong Economic Times seek to list next month
At least four companies are lining up to tap the Hong Kong market for a total of about $2 billion, with initial public offerings from AAC Acoustic Technologies and Hong Kong Economic Times Group (HKET) likely to be first.
AAC, which focuses on design and production of acoustic components for mobile phone handsets and digital music players, is pre-marketing its up to $975 million offering ahead of a planned listing early next month, a source said yesterday.
Yesterday, HKET won stock exchange approval for its $200 million offering. The company is set to start briefing investors on the share sale today, with its listing planned for early next month.
Mainland watches distribution agent Xin Yu Hengdeli and the country's largest apple juice concentrate producer China Hai Sheng Holdings are expected to follow, raising $300 million each around the end of next month.
AAC plans to raise $780 million to $975 million by selling a 25 per cent stake. Sole book runner CSFB declined to comment.
'The roadshow of AAC starts on July 21,' said the source, adding pricing of the shares was scheduled for August 2, ahead of the listing on August 9.
The offering kicked off amid the debut of Shinhint Acoustic, which ended 1.25 per cent higher yesterday after raising $60 million.
'Shinhint is not a good comparison for AAC as the latter focuses on miniature components while the former's products are bigger,' the source said, suggesting other listed mobile handset equipment makers such as Foxconn International Holdings were a more accurate benchmark.
Last year, AAC posted net profit of more than 200 million yuan on revenues of about 626.8 million yuan, co-manager ABN Amro said in a research report. In 2003 and 2002, its net profits were 138.5 million yuan and 89.9 million yuan respectively. Revenues were 422 million yuan and 318.1 million yuan respectively.
Founded in 1993, AAC in 1998 secured Motorola as its first major foreign handset customer and set up a factory in Shenzhen to produce transducers.
Xin Yu Hengdeli plans to raise $200 million to $300 million late next month or early September.
'The listing hearing is expected to be held at the end of this month,' a source familiar with the deal said. Guotai Junan Hong Kong is the sponsor and sole bookrunner.
The watch distribution agent was founded in 1924 and has shops throughout China, including Beijing, Shanghai, Shenzhen and Nanjing, selling brands including Jaeger-Le Coultre, Bulgari and Tissot.
Sources said Xin Yu's profit rose to almost 100 million yuan last year and the company expects that to grow steadily. 'There are more and more affluent people in the mainland and wearing international brands watch is a kind of middle-class symbol,' the source added.
China Hai Sheng will also have its listing hearing at the end of this month, according to sources.
'If everything is on schedule, the listing hearing is expected to be held soon ahead of a main board listing in September,' sources said.
Hai Sheng plans to raise about $300 million. CLSA is the share sale arranger.
ACC Acoustic Technologies aims to raise up to $975 million
Hong Kong Economic Times Group targets $200 million
Xin Yu Hengdeli sets its sights on $200 million to $300 million