Tenwow Group, a Shanghai-based food retailer, will on Tuesday begin to pre-market its Hong Kong initial public offering of $100 million-$200 million, which will be the first sizable listing to hit the market since July.
The company has secured strong support from three cornerstone investors, according to two people close to the situation. Carlyle Group, the US private equity firm, Europe-based PE firm Milestone and mainland PE firm Orchid agreed to buy shares worth $47 million, $35 million and $10 million respectively. The cornerstone investments will account for at least 46% of the deal.
The timetable for the IPO was set for September, according to people close to the situation. However, with the big names secured as cornerstone investors, the deal can be done earlier.
Tenwow will conduct pre-marketing for one week before it launches a roadshow. It will list on the bourse in middle September.
And it is not the only company attempting to break the summer lull.
Forgame, a Guangzhou-based online gaming company, is looking to start pre-marketing its Hong Kong IPO of $150 million-$200 million next Monday.
Founded in 2009, Forgame secured domestic venture capital group Qiming Venture, Ignition Capital Partners of the US and TA Associates last July as the first institutional investors in the company.
The company is targeting a listing in early October.
CICC, Deutsche Bank and HSBC are arranging the Tenwow float, while JP Morgan and Morgan Stanley are sponsors on the Forgame listing.
The two deals will test investor appetite towards IPOs in the Hong Kong market, which had been the world’s top IPO hub from 2009 to 2011, but lost its charms since then amid increasing concerns over the slowdown of China’s economy.
Even so, some big issuers plan to tap the market after the summer. Huishang Bank has filed a listing application to the Hong Kong Stock Exchange for a $1.5 billion-$2 billion IPO, while Cinda Asset Management filed two weeks ago for an IPO of $1.5 billion. Bank of Shanghai plans to start the Hong Kong listing of its $2 billion A/H IPOs by the year end.
Meanwhile, Huishan Dairy, a mainland food company, is also expected to come to market in September with a $1 billion IPO.
