Allied Cement, aims to use nearly all the proceeds of its initial public offering to pay off debt after listing on the main board of the stock exchange.
The mainland cement and clinker producer, registered in the Cayman Islands, will begin trading on January 18 and offer 165 million shares at an offer price of HK$1 per share, of which 31.35 million shares will be offered to the public.
Allied, whose revenue and profits have been in decline in recent years, hopes to raise a net HK$145 million from the listing, according to its prospectus.
The company will use HK$130 million to repay its debts to its majority shareholder, Tian An China Investments, a Hong Kong-listed property and construction material company. It will use another HK$10 million to repay a bank loan due in 12 months.
The company has no plans to expand the business.
'Our financial results experienced significant fluctuations. We may not be able to stabilise our operating results, or we may have difficulties in managing our future growth,' warns Allied's prospectus.
