Lukewarm retail response sees China Vast add to international IPO offering
China Vast Industrial Urban Development saw the retail tranche of its initial public offering only 97 per cent subscribed.
China Vast Industrial Urban Development saw the retail tranche of its initial public offering only 97 per cent subscribed.
The mainland developer announced yesterday it would reallocate the unsubscribed shares to the international offering, which was slightly oversubscribed.
After the relocation, the international portion will represent 90.25 per cent of the global offering, with the rest going to Hong Kong retail investors. The initial offering had 31.97 million shares allotted for retail investors.
Cornerstone investor Dyfed Holdings subscribed for 75 million shares, or 22.87 per cent of the offering.
The shares will begin trading on Monday.
China Vast, which develops large industrial towns around industrial parks on the mainland, priced its shares at HK$3.10, near the middle of its indicated range of HK$2.75 to HK$3.75.
The offering of 328 million shares will raise a net HK$927.1 million.
The company said it would use 65 per cent of the net proceeds to develop its current industrial town projects, with an additional 15 per cent to go towards paying land rights and construction costs for developing residential and commercial property.
The remainder would be for developing industrial town projects and general working capital.
China Vast built its first industrial park in 2005 in Langfang, Hebei province.
It is working with local governments to develop four industrial towns with a total site area of 67.5 million sqmetres, according to the company's prospectus.
The company had revenue of 1.2 billion yuan (HK$1.51 billion) last year, a 160 per cent increase over 2012.
Net profit in the first quarter of this year was 101.3 million yuan, a 545 per cent increase over the same period last year.
Morgan Stanley and Citic Securities International sponsored the share offering.
