Listing candidates return to market with lower valuations

A number of candidates proceeding with plans to offer shares face at least a 20 per cent cut in valuations in order to secure their listings.

Among the companies is mainboard candidate ColbyNet, which shelved its HK$2.65 billion initial public offering (IPO) a month ago, and Proactive Holdings, recently approved as a Growth Enterprise Market (GEM) candidate.

Sources close to ColbyNet said the company had relaunched its pre-marketing early this week, but the size and the terms of the offering were still to be determined. They would depend on the response received during pre-marketing and the performance of the stock market in the next few days. Sources estimated the company would have to trim the size of its offering by at least 20 per cent amid poor market sentiment.

The merchandise sourcing firm was originally scheduled to list on the main board on April 18. ColbyNet called off the sale of shares due to a slide in global technology counters. At the time, the company said it would postpone the offering 'until market conditions stabilise sufficiently to create an active and ongoing after-market for the company's prospective shareholders'.

Proactive Holding, which got the nod from Hong Kong Exchanges and Clearing for its GEM listing, also said it would go ahead.

The tele-commerce technologies and services provider said yesterday that it had successfully raised HK$64 million by placing 46.6 million shares at HK$1.38 each to institutional investors.