Kerry Properties chairman Kuok Khoon Chen yesterday set out to counter unfavourable market comment about the company's $2.62 billion new issue and concerns about the likely share performance on its debut on Monday. Mr Kuok said he believed most investors buying Kerry shares looked at the company on a long-term basis. He said he did not want to place too much importance on the first day of trading, adding that it would not be fair to assess a company's performance by looking at share movements within a short period of time. The company's public offer of 22.5 million shares received a lacklustre response and was only 1.03 times subscribed despite the issue price being cut to $17.50 per share, down from the original $19.50 to $21.50 range. A further 127.5 million shares were placed with international institutional investors. Mr Kuok said the decision to slash the offer price was due to the weak state of equity markets worldwide during the group's international promotional roadshow. Chief financial officer Chew Fook Aun said the price reduction came into line with the performance of stock markets, and that the original price range was not expensive at the time of fixing but comparable to other companies on the market. Given a lower price now, the amount of funds being raised from the issue had been reduced by as much as about $500 million. Mr Chew said the company still had very strong cash flow. Its gearing ratio was 10.3 per cent, making it one of the lowest geared companies on the market, he said. Of the $2.48 billion net proceeds, $1.5 billion would be used to repay debts to former and existing shareholders. Mr Chew said that of the $1.5 billion, about $1 billion was working capital advanced by major shareholders. Already, $8.31 billion of shareholders' loans had been capitalised. Regarding the $1.43 billion acquisition of interests in Tregunter Towers I and II, Mr Chew said Kerry Properties had paid a deposit of $143 million and a further $210 million would be paid by the issue of 12 million shares to vendor Hongkong China. The balance of about $1.07 billion would be financed by cash and/ or loans but would not be funded by the new issue's proceeds, he said. Elaborating on the group's projected profit of at least $1.01 billion this year, Mr Chew said 60 to 70 per cent came from recurrent income, with the balance from development profit and property sales. Mr Kuok said the listing would provide Kerry Properties with access to cheaper funding and set the stage for further expansion. As a public company, it would become transparent and this would create more opportunities for it to enter into joint ventures with other companies to pursue new projects, he said. He said parent company Kuok Group would not inject its 25 per cent interest in the Tamar Basin commercial development into Kerry Properties.