Dec. 3 (Bloomberg) -- China ZhengTong Auto Services Holdings Ltd., the second biggest dealer of Bayerische Motoren Werke AG autos in China, raised HK$3.65 billion ($470 million) selling stock in a Hong Kong initial public offering, according to two people with knowledge of the matter.
The company, which operates six of its 22 dealerships in central China’s city of Wuhan, sold 500 million shares at HK$7.30 apiece after offering them at HK$6.80 to HK$8.60 each, said the people, who declined to be identified before an announcement.
The final offer price values ZhengTong at 17 times forecast 2011 earnings, the people said. JPMorgan Chase & Co. and CCB International managed the transaction.
China’s surging vehicle sales have helped increase profits and operations at ZhengTong and other auto dealers. ZhengTong plans to use the share-sale proceeds to more than triple its number of outlets to 68 by the end of 2012, according to its share sale prospectus.
ZhengTong’s revenue rose 64 percent in 2009 from a year earlier to 4.98 billion yuan ($748 million), according to the listing document. Kelly Fung, a ZhengTong spokeswoman in Hong Kong, was not immediately available to comment.
To contact the reporter on this story: Fox Hu in Hong Kong at firstname.lastname@example.org
To contact the editor responsible for this story: Darren Boey at email@example.com