Analogue Holdings, company chaired by Teresa Cheng’s husband, raises US$43 million in IPO

Analogue Holdings, Hong Kong’s largest electrical and mechanical engineering company controlled by the husband of the city’s justice minister, raised HK$336 million (US$43 million) in net proceeds in an initial public offering on Friday.

Shares of the company dipped 4 per cent to HK$1.15 apiece in the market open from an offering price of HK$1.2, before rising to an intraday high of HK$1.47. They were trading at HK$1.32 as of 9.52am. The company offered 350 million shares in total.

Analogue said because the retail tranche was oversubscribed 6.6 times, it decided to double the public portion to 20 per cent of the overall shares, in a stock exchange filing on Thursday.

The IPO comes as the interbank lending rate spiked to its highest level since October 2008. The increased borrowing costs, which stood at 2.99 per cent last Thursday, also affected the response to Budweiser Brewing Company APAC’s IPO, analysts said. The Hibor has since eased, to 2.38 per cent as of Thursday.

Otto Poon Lok-to, 78, a senior engineer and husband of Hong Kong’s Secretary for Justice, Teresa Cheng Yeuk-wah, founded Analogue in 1977. The company is the city’s top provider of services ranging from air-conditioning system design to lift installations, occupying a 9 per cent market share, according to a stock exchange filing.

“I’d say the market reaction is quite cautious, because construction [related] stocks tend to have lower growth,” said Kenny Tang Sing-hing, chief executive at Royston Securities.