Saturday May 17, 2008

Pou Sheng, Xtep launch US$784m IPOs in Hong Kong

HONG KONG: Chinese sportswear retailers Pou Sheng International (Holdings) Ltd and Xtep International Holdings launched marketing roadshows yesterday to raise a combined US$784mil in Hong Kong initial public offerings, sources close to the deals said.

Numerous capital hungry firms are seeking to raise funds in the second quarter, many of them consumer-related companies offering exposure to surging household spending power in China, where retail sales rose 22% in April from a year earlier.

Pou Sheng, a spin-off from the world’s top sports shoe maker Yue Yuen Industrial (Holdings), plans to raise as much as US$396mil in a Hong Kong IPO, by selling 823.4 million shares at HK$2.93-HK$3.75 each, one source said.

Sportswear retailer Xtep International Holdings Ltd, in which US private equity company Carlyle Group has a stake, plans to raise as much as US$388mil by offering 550 million shares, or 25% of its enlarged share capital, at HK$4.05-HK$5.5 each, the sources said.

Investors have been wary when it comes to recent offerings in Hong Kong, with many sticking to tried-and-true

The IPOs come after a series of weak stock market debuts as the benchmark index has dropped nearly 8% so far this year, although the index has rebounded 25% since its low in mid-March. – Reuters

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