Hopewell arm eyes float amid upbeat outlook

Hopewell Hong Kong Properties, a spin-off from the conglomerate Hopewell Holdings, plans to raise up to US$800 million from an initial public offering in Hong Kong, cashing in on the positive outlook for the city's commercial property market.

Bankers said the company, the property arm of Hopewell Holdings, may raise between US$500 million and US$800 million, and the roadshow may kick off as early as Monday.

The new shares are believed to be priced at a discount of 30 per cent to net asset value, while the company is poised to offer higher earnings growth than the industry average, bankers said.

BOC International and Credit Suisse are the sponsors of the deal.

Analysts said the key to the fundraising plan is whether investors would bet on the upside potential of Hopewell's rental assets in Wan Chai, which will house its new developments Hopewell Centre II and 200 Queen's Road East.

Vincent Cheung Kiu-cho, national director of Greater China at the consultancy Cushman & Wakefield, is upbeat on the growth potential of Wan Chai on the back of the Hopewell Centre II development. Current rents in Wan Chai do not reflect the future value of the district, Cheung said.