COUNTRY REPORT HONG KONGNasdaq IPO of up to US$104m.
The company is selling 8.3m American
depositary shares at US$10.50–$12.50
apiece. The price range represents a 2019
price-to-sales ratio of 2.2–2.7.
There is a 15% greenshoe.
Venture backer GGV Capital, an 11.2%
pre-IPO holder, has indicated for up to
US$10m of the deal.
The deal will price on October 18 post
market close.
Niu, which has sold 431,500 electric
scooters, primarily in China and Europe,
plans to spend US$30m of the IPO
proceeds to expand and upgrade factories,
US$30m on R&D, US$15m to expand its
distribution, and the balance for general
purposes.
Founded in 2014, Niu posted a net loss of
Rmb315m for the first six months of this
year, wider than a Rmb97m loss the year
before. It had an annual loss of Rmb185m
in 2017.
Niu is seeking to differentiate itself from
competitors with its higher margins. The
company accounts for 39.5% of electric
scooter sales volume in China, though it
has just a 26% market share (by number of
scooters sold).
Citigroup and Credit Suisse are the joint
bookrunners.
› WEIDAI PRE-MARKETING NYSE LISTING
WEIDAI, a Chinese provider of financing
services for small businesses, kicked off
pre-marketing for its US$100m NYSE IPO
last Monday, people with knowledge of the
deal said.
The tentative date for the books to open
is October 15, according to the people.
Established in 2011, Weidai has a
network of 517 service centres across
more than 300 cities in China. It connects
borrowers, the majority of which are
small and micro enterprise owners, to
online investors and institutional funding
partners.
Founder and Chairman Hong Yao is the
controlling stakeholder in the company
with a 73.3% equity interest, including
a 13.2% stake held via Deqing Jinxiu
Management Consultancy Partnership, an
entity he owns with his wife.
Weidai posted net income of Rmb307m
for the first six months of 2018. It had
yearly net income of Rmb475m in 2017 and
Rmb291m in 2016.
Citigroup, Credit Suisse and Morgan Stanley
are the joint bookrunners for the deal.
› DEXIN TO RAISE UP TO US$300M IN IPO
DEXIN CHINA, a property developer based in
Zhejiang province, plans to raise around
US$200m–$300m from a Hong Kong IPO by
the end of this year, a person close to the
deal said.
The listing plan has been filed to the
Stock Exchange of Hong Kong.
As of June this year, the developer had
completed 25 property projects, with 54
under construction and 22 in the pipeline.
It has total land reserves of 6.34m square
metres, nearly 86% of which are located in
Zhejiang.
It posted a 2018 half year profit of
Rmb463m on revenue of Rmb2.47bn,
compared with a profit of Rmb261m and
revenue of Rmb2.76bn in the same period a
year earlier.
Hu Yiping, who founded the company in
1995, controls 94% of Dexin China with his
son Hu Shihao.
CCB International is the sole sponsor for
the float.› SHANSHUI CEMENT PLANS SHARE SALESHANSHUI CEMENT plans to sell HK$409m
(US$52m) of new shares to restore its public
float and redeem a bond due 2020.
The Chinese cement producer plans to
sell about 975m shares, or 22.4% of the
enlarged share capital, at HK$4.20 each.
The placement price represents a discount
of 33% to the pre-deal close.
The placement is expected to help lift
the company’s public float to not less than
25% before the October 31 2018 deadline
imposed by the Stock Exchange of Hong
Kong for the company to address its public
float issue.
The company plans to use about 95% of
the proceeds to redeem the 2020 bond,
which has an outstanding amount of
US$435.8m, and the rest to repay debt.
Shares of Shanshui Cement have been
under a trading suspension since April 16
2015.
Last December, the Hong Kong stock
exchange initiated a procedure to cancel
Shanshui’s listing if it was not able to
restore a minimum public float of 25%
of its issued share capital and address its
audit issues by mid-2018. The deadline
was then extended to the end of October.› DAFA PRICES IPO ABOVE MID-POINTDAFA PROPERTIES, a Chinese real estate
developer in the Yangtze River region, has
priced its Hong Kong IPO slightly above
the mid-point of a price range to raise
HK$840m.
The Shanghai-based developer offered
200m primary shares, representing 25%
of the enlarged share capital, at HK$4.20
each versus an indicative price range of
HK$3.28–$4.98 per share. The price givesthe company a market capitalisation of
HK$3.35bn.
There is an overallotment option of up to
15% of the base size.
Two cornerstone investors, Everbright
Xinglong Trust and Foshan Shunde Jianshi
Enterprise Asset Management, are backing
the deal for about US$10m each.
Most of the proceeds will go towards the
construction costs of developing existing
property projects and repaying Rmb530m
of debt from an asset management
company. The remainder will be used for
general working capital.
DaFa has a portfolio of 29 projects
comprising 24 residential properties,
four commercial complexes and an office
floor. They are situated in the provinces of
Shanghai, Jiangsu, Anhui and Zhejiang.
DaFa’s shares are due to start trading on
October 11.
CCB International is the sole sponsor and
sole global coordinator for the float.HONG KONG
SYNDICATED LOANS
› YUEXIU REIT LAUNCHES HK$2.8BN LOANHong Kong-listed Yuexiu Real Estate
Investment Trust has launched a HK$2.8bn
(US$358m) five-year term loan.
Bank of China (Hong Kong) and Standard
Chartered are the mandated lead arrangers
and bookrunners of the transaction, which
comprises a HK$2.2bn tranche A and a
HK$600m tranche B.
The deal offers an interest margin of
138bp over Hibor and has an average life of
4.75 years.
MLAs committing HK$450m or more
will receive an all-in pricing of 154bp via
a participation fee of 75bp, while lead
arrangers joining with HK$300m–$440m
earn an all-in pricing of 149bp via a 54bp
fee. Arrangers coming in for HK$150m–
$290m will receive an all-in pricing of
144bp via a 30bp fee. The deadline for
responses is November 2.
YUEXIU REIT 2013 is the borrower, while
Yuexiu Real Estate Investment Trust is the
guarantor.
Funds are for refinancing and working
capital purposes.
In December 2016, Yuexiu Real Estate
Investment Trust raised a HK$2.3bn three-
year bullet term loan. DBS Bank was the
sole MLAB of that deal, which paid a top-
level all-in pricing of 128bp based on a
margin of 95bp over Hibor.