Chow tai fook seeks up to Hong kong(Reuters)Chow tai fook jewellery group ltd
could raise up to $2. 83 billion, which would be the biggest Hong konginitial
public offering of the year, tapping volatile equity markets to fund the
purchase of diamonds and gold and pay down debt. The hong kongbased company will
offer 1.05 billion shares at HK$15 to HK$21 each, putting the total deal size at
up to HK$22.05 billion($2.83 billion), two sources with direct knowledge of the
deal told Reuters on Friday.The sources could not be named because details of
the deal are not yet public.Jeweller tiffany co. "They're a very established
brand and they've been around forever, so there's a reason for them to want to
be listed,"Said selina sia, head of consumer research at mirae asset in hong
kong. "It really depends on the pricing, the market is not doing well. " The
83yearold jewelry retailer is among several companies pushing ahead with
offerings, despite the uncertainty over europe's debt troubles that has caused a
roller coaster ride in markets the past several weeks. Other major deals lined
up in the region include insurer new china life's Beats By Dr.Dre
$2.5 billion dual listing in Shanghai and Hong Kong and brokerage Haitong
Securities' up to $2 billion offering. Chow tai fook's ipo will have no
commitments from socalled cornerstone investors, one of the sources said, a sign
that investors are unwilling to tie up their funds for an extended amount of
time. Such investors back many asian listings, committing to buy large,
guaranteed stakes and agreeing to a lockup period during which they will not
sell their shares. The ipo will instead count on a large list
of"Anchor"Investors that have less restrictions on when they can sell the stock,
the source added. The stock will trade under the symbol"1929,"The year the
company was founded. Jewelry retailers and luxury goods companies in china have
benefited from the massive economic shift in the country, with urbanisation,
wage growth and the rise of women here
in the labor force all stoking
demand for diamonds, leather bags, designer clothes and sports cars. Chow tai
fook has about 1, 500 stores, most of them in greater china.The company also has
shops in singapore, taiwan and malaysia. In hong kong and gambling center macau
alone, the company has about 80 stores and is a household brand, with a massive
marketing campaign that has more than 1, 000 doubledecker busses brandishing the
bordeauxcoloured ads around the former british colony. Growth has boomed in
recent years and the company plans a largescale expansion, targeting to grow to
2, 000 stores by 2016.The company went from opening http://www.lammonia.net/monster-headphones.html
its first outlet in beijing in 1998 to more than 1, 400 stores in 260 chinese
cities in 12 years. Chow tai fook plans to use 50 percent of the ipo funds to
build its inventory and secure supplies of gems and precious metals. About 31
percent of the proceeds will be set aside to pay down loans and a combined 8.6
percent allotted to property for new stores and research and development.