Sino Land, the city's seventh-largest developer by market value, is planning to raise as much as US$534 million hot on the heels of a share placement by rival Hang Lung Properties last week.
The developer plans to raise between US$518 million and US$534 million in a share sale at a 6.5 to 9.2 per cent discount to yesterday's closing price of HK$18.28, according to a term sheet. It is offering 242 million shares at HK$16.60 to HK$17.10 each. Goldman Sachs is the sole bookrunner of the sale.
The amount is far below Hang Lung Properties' HK$10.9 billion share placement but, according to one analyst, could be followed by a later share sale.
'They [the management of Sino Land] don't want to miss the chance of financing in a bull market,' the analyst said. 'So they will make a smaller placement first and then may follow up with another.'
He believes the proceeds will be used for land acquisitions to take advantage of the government's plan to release more sites for sale in the coming year.
Sino Land acquired two development sites and a serviced apartment project so far this year. The sites could provide a total gross floor area of more than 1.6 million square feet.