Wood firm Samling targets US$300m from HK share sale
Lee Yuk-kei, Tim LeeMaster and Wong Ka-chun
Samling Group, a Malaysian-based integrated forest resource and wood products company, plans to raise up to US$300 million in a Hong Kong initial public offering next month, market sources said.
Samling's offering comes as the Hong Kong stock exchange hopes to lure more companies from Southeast Asia to list.
Most of the current offerings are from the mainland or Hong Kong, including Beijing Huiyuan Juice Holdings, which received stock exchange preliminary approval yesterday for its US$250 million issue.
Sino Gold, a mainland-based gold miner that listed in Australia, was also scheduled to seek approval yesterday for its US$100 million flotation.
Sources said that although Samling controlled two Malaysian-listed units, it still wanted to float its shares in Hong Kong to attract international investors and strengthen its presence in the mainland.
Samling would have a market value of about US$1 billion after the listing, sources said. Credit Suisse and HSBC are arranging the deal.
'This type of commodity firm is very rare on the Hong Kong stock market' so investors would not find many similar companies, a source said.
One Hong Kong-listed peer is China Grand Forestry Resources, an apparel maker-turned-timber company. Its shares are trading at 44 times historical earnings.
Samling has timber resources and production facilities in Malaysia, Guyana, China and New Zealand.
The company produces hard wood products for building materials, furniture, decorative wall panels and others to more than 30 markets including Japan, Europe, the United States, China and other countries in Asia.
'The offering is really attractive as there has been a lack of wood supply globally for a long time,' said a fund manager. 'The firm has rights to explore opportunities in the tropical rainforests to give it stable supply.'
Samling controls Lingui Development and Glenealy Plantations (Malaya), both listed in Malaysia. Lingui is mainly involved in timber industries while Glenealy is engaged in the palm oil industry.
Glenealy reported pre-tax profit of 26 million ringgit (HK$57.9 million) for the past business year to June, while Lingui recorded a pre-tax profit of 16.6 million ringgit.
Meanwhile, Huiyuan Juice planned to launch its offering next month after the Lunar New Year, a source said. UBS is sponsoring the deal.
Before the listing in Hong Kong, Huiyuan brought in several financial and strategic investors including French food group Danone and buyout firm Warburg Pincus to strengthen its reserves for expansion.