Listing candidate Ying Wing Holdings will use almost half of the proceeds from its initial public offering to repay bank borrowings. The fabric processor and distributor yesterday unveiled a plan to offer 50 million new shares at $1 each, of which 25 million shares will be sold by private placement with the remainder being offered to the public. Of the $41 million in net proceeds, $20 million will be used to repay bank loans. A further $8 million will be used to expand production capacity at the company's mainland plant and $8 million more will be used as working capital to sub-contract weaving to a Sino-foreign joint venture. Chairman Tsoi Hon-chung said that after repaying $20 million in debt, the company would only have another $4 million outstanding. He said the company's shift in focus from fabric trading to raw-material processing had lifted last year's net margin to 14 per cent from just 4 per cent in 1995. The company forecast a net profit of not less than $40 million for this year giving 26.43 cents earnings per share. The offer price of $1 per share translates into a prospective price-earnings multiple of 3.78 times. The public offer will close on Friday and the shares will debut on December 29.