Dali Foods Said to Raise $1.15 Billion in Hong Kong IPOby
Dali Foods Group Co., a Chinese snack and beverage producer, raised $1.15 billion from an initial public offering in Hong Kong, selling the shares near the low end of a marketed range, people with knowledge of the matter said.
The maker of “Daliyuan” cakes and “Copico” brand potato chips priced 1.69 billion shares at HK$5.25 ($0.68) each, said the people, who asked not to be identified because the information is private. The stock was marketed at HK$5 to HK$6.15 each, according to Dali’s prospectus.
Dali is raising money to increase production as China seeks to re-balance an economy toward more domestic consumption and services. The Fujian province-based company’s share sale would help boost the total value of IPOs in Hong Kong to about $27.7 billion this year, the highest 11-month tally since 2010.
Three cornerstone investors including a unit of Central Huijin Investment Ltd. agreed to buy $305 million of stock in the offering, the prospectus shows. Cornerstone investors typically agree to hold on to their shares for six months in return for early and guaranteed allocation.
Dali plans to start trading Nov. 20, the prospectus show. Bank of America Corp. and Morgan Stanley are joint sponsors of the offering.
The value of China’s snack food market is expected to surge 72 percent from last year to 598.6 billion yuan ($94 billion) in 2019, according to Dali’s stock exchange statement, which cited Frost & Sullivan.The retail sales value of China’s non-alcoholic beverage market rose 16.7 percent to 962.6 billion yuan in 2014 from 2009.