Amway to spin off offshoot

PUBLISHED : Wednesday, 10 November, 1993, 12:00am
UPDATED : Wednesday, 10 November, 1993, 12:00am

AMWAY Corp, armed with aggressive plans to penetrate the consumer products market in China, plans to list its Asian-Pacific subsidiary on the New York and Australian stock exchanges.

The company said yesterday it had filed a registration statement with the US Securities and Exchange Commission for an initial public offering of Amway Asia Pacific, which would be based in Hong Kong.

Amway Asia Pacific will raise US$126.4 million to $142.2 million by issuing 7.9 million shares at $16 to $18 each.

A prospectus has been filed in Australia for a concurrent offering of 900,000 of the 7.9 million shares.

There will be no public offer in Hong Kong and there are also no plans to seek a listing in the territory.

The company will be the sole distribution vehicle for parent Amway Corp in China, with sales expected to start in the middle of 1995 when a $45 million joint-venture manufacturing facility in Guangzhou is operational.

Amway, which sells household cleaners, personal care, nutrition and houseware products through a network of two million independent salespeople, said it would cost $70 million to $100 million to build the plant and provide initial inventory for its distributors.

Amway Asia Pacific, which includes operations in Hong Kong, Australia, New Zealand, Malaysia, Thailand, Taiwan and Macau, posted net income of $68.7 million on sales of $554 million for the year to August 31.

Sales in Asia are more than $1.4 billion.

Merrill Lynch & Co is acting as the global co-ordinator for the offer. Merrill Lynch International, Jardine Fleming International and N.M. Rothschild & Sons will co-manage the international offer, except in Australia.