HK$3.12b offerings follow Belle deal
Investors sell Gome, Sino-Ocean shares
Yesterday was another busy day for investors queuing up to tap the equity market for as much as HK$3.12 billion, just one day after the HK$5.5 billion mega sell-down in shoemaker Belle International Holdings.
Wong Kwong-yu, the biggest shareholder in Gome Electrical Appliances Holding, the mainland's largest electrical appliance retail chain operator, was seeking to raise as much as HK$2.2 billion by cutting his stake in the firm to less than 40 per cent, according to a sale document obtained by fund managers.
Mr Wong was offering 125.4 million existing Gome shares with an indicative price ranging from HK$17.10 to HK$17.55 per share, representing a discount of as much as 6.46 per cent to yesterday's closing price of HK$18.28, the document shows.
Goldman Sachs is the sole bookrunner for the offering.
Mr Wong, the company and the management have agreed not to sell any shares for the next 30 days after completion of the offering. Mr Wong's stake in the firm will also fall from 42.16 per cent to 38 per cent.
The mainland retail billionaire has visited the equity market twice in the past two years, raising a total of HK$3.6 billion in two separate share placements.
'We consider the placement as a way of saving for a rainy day, which entrepreneurs should do,' said Du Juan, an executive director of Gome and Mr Wong's wife. 'If the stock market stays volatile, we still have enough funds for development and for a possible share buy-back.'
Meanwhile, sources said the Morgan Stanley Real Estate Fund, the real estate investment unit of Morgan Stanley, was selling a 3.4 per cent stake in mainland property developer Sino-Ocean Land Holdings at a discount of up to 7.51 per cent.
The investment fund, through special unit SSF Livingston Holdings, offered 150 million existing Sino-Ocean shares to institutional investors at a price of HK$5.91 to HK$6.15 each, to raise up to HK$922 million from a secondary share placement, according to a terms sheet obtained by fund managers.
Citi and Morgan Stanley are jointly leading the transaction.
Two weeks earlier, another investor in Sino-Ocean attempted to raise HK$622 million from a share placement but a source close to the offering said the deal was not completed because of the weak response.
A strong rebound in the Hong Kong stock market since mid-March has prompted investors to sell down their holdings. The Hang Seng Index has gained more than 3,000 points over the past month.
Two groups of institutional investors in Belle and China Shenhua Energy reaped a total of HK$6.15 billion through share placements on Thursday.
'You can expect more share placements in the next few days as I've been approached by more than five investment bankers for an equity share offering yesterday,' said a fund manager who was invited to take part in yesterday's placements.
