Pork giant WH Group offers ADRs in US to expand investor exposure

PUBLISHED : Wednesday, 18 January, 2017, 10:19am
UPDATED : Wednesday, 18 January, 2017, 10:19am

Chinese pork giant WH Group has established a batch of American depository receipts as part of an effort to increase its exposure in overseas markets.

Each of the 50 million ADRs represents 20 ordinary shares in the world’s largest pork packaged meat producer. They are based on WH’s issued shares in Hong Kong as no new shares were issued for the ADR programme, according to a company’s statement filed with the Hong Kong exchange on Wednesday.

“The establishment of the ADR programme will provide the company with exposure to the capital market in the United States at minimal cost and maintenance effort and will also broaden the investor base of the company,” chairman and chief executive Wan Long said in the statement.

WH Group shares inched up 0.65 per cent to HK$6.17 at 9.53am.

WH Group made a name for itself in the global market in 2013 with its US$4.7 billion acquisition of Smithfield Foods, the largest pork producer in the US.

Luis Chein, director of WH Group, earlier told the South China Morning Post that WH will consider another large scale acquisition by the end of 2017 when its debt level drops to comfortable level.

Chinese pork giant WH Group may eye major acquisitions by end of 2017

The ADRs, sponsored by BNY Mellon, will be traded on the over-the-counter market in the United States and will not be listed on any stock exchange, the statement said.

An ADR is a negotiable certificate denominated in US dollars, issued by a US bank, and representing a specific number of shares of a foreign stock.