Sept. 9 (Bloomberg) -- China Huishan Dairy Holdings Co., the milk producer backed by billionaire Cheng Yu-tung, is seeking as much as $1.3 billion in an initial public offering in Hong Kong, said two people with knowledge of the matter.
Huishan Dairy plans to offer 3.8 billion shares at HK$2.28 to HK$2.67 apiece, said the people, who asked not to be identified because the information is private. The company, based in Shenyang city in northeast China, plans to take orders this week and start trading on Sept. 27, they said.
The IPO is Hong Kong’s biggest since Sinopec Engineering Group Co. raised $1.8 billion in May, according to data compiled by Bloomberg. Companies have raised $5.9 billion through initial sales in Hong Kong this year, more than double the proceeds for the same period of 2012, the data show.
The price range values Huishan Dairy at 14.4 to 17 times estimated 2014 earnings, they said.
A Hong Kong-based external spokeswoman for Huishan Dairy could not immediately comment on the IPO plan. The Wall Street Journal reported the price range earlier today.
China Modern Dairy Holdings Ltd., the country’s biggest raw-milk producer, trades at 17.7 times estimated 2014 profit, data compiled by Bloomberg show. The company raised $447 million through a Hong Kong IPO in November 2010 and has fallen 3 percent from the offer price, the data show.
Dairy company Inner Mongolia Yili Industrial Group Co., in a stock exchange statement today, said it will invest $50 million in China Huishan Dairy Holdings to stabilize its supply of raw milk in Northeastern China.
To contact the reporter on this story: Fox Hu in Hong Kong at email@example.com
To contact the editor responsible for this story: Philip Lagerkranser at firstname.lastname@example.org