Business

Thu May 22 03:16:29 PDT 2008

(For an expanded IPO diary, please click <HK/IPOMENU>) (Combines earlier stories, adds brokerage comment, details)

By Kennix Chim

HONG KONG, May 22 (Reuters) – Hong Kong bulk and tanker shipping company Wah Kwong Maritime Transport Holdings Ltd and Chinese hot pot restaurant chain Little Sheep Group Ltd kicked off IPO marketing roadshows on Thursday to raise a combined $279 million, according to documents sent to investors.

Recent subscription figures from IPOs show investor appetite for new listings in Hong Kong remains weak, but at least seven firms are looking to list in Hong Kong by the end of June to raise a combined $2.1 billion.

The benchmark Hang Seng Index <.HSI> slid more than 2.5 percent on Thursday morning and is down nearly 11 percent so far this year.

"Global stock markets have plunged in the past few days. Investors are not only cautious on equity investment, but also do not care about new offerings as recent deal sizes are small," said Francis Lun, general manager at Fulbright Securities.

Wah Kwong, one of Hong Kong’s oldest bulk shippers, plans to raise as much as $163.5 million by selling 125 million new shares, or 25 percent of its enlarged share capital, at HK$7.78-HK$10.20 each, a document said.

Wah Kwong’s predecessor, Wah Kwong Shipping, went public in Hong Kong in 1973, but after a period of share price weakness was delisted and taken private in 2000.

The company, which focuses on long haul transportation for bulk cargoes such as iron ore, coal, crude and refined oil, has a fleet of 11 mid- to large-sized bulk carriers and tankers, with an average age of around 2.3 years.

Separately, Little Sheep, in which private equity firm 3i Group Plc <III.L> and Prax Capital have stakes, plans to raise $116 million in an initial public offering by selling 245 million shares at HK$2.68-HK$3.68 each, a document said.

Of the shares on offer, 71.3 percent are new and the remainder are existing shares.

A source familiar with the deal told Reuters earlier that the firm had planned to sell 224 million shares, but then slightly increased the size of the offering.

Both Little Sheep and Wah Kwong expect to start Hong Kong public offerings on May 29 but Wah Kwong is scheduled to begin trading on June 11 and Little Sheep plans to list on June 12.

Cazenove [CAZ.UL] and Anglo Chinese Corp Finance Ltd are sponsoring Wah Kwong’s deal while Merrill Lynch <MER.N> and Deutsche Bank <DBKGn.DE > are sponsoring Little Sheep’s deal.

(US$1=HK$7.8)

(Reporting by Kennix Chim; Editing by Anne Marie Roantree)

Provided by Reuters

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