Orchid-backed Time Watch raises $105m in Hong Kong IPO

Strong retail investor demand for this and other IPOs - there have been six in Hong Kong so far this year - suggests the backlog that built up over the course of 2012 might be partially cleared. A host of PE and VC portfolio companies are among those waiting to list.

Having set an indicative range of HK$1.11-1.35, Time Watch was able to sell at HK$1.35 per share, which represents a forward price-to-earnings (P/E) ratio of 9.3x, according to IFR Asia. If the greenshoe option is exercised, the size of the offering would increase by 15%.

Orchid Asia V - a $650 million vehicle that closed in July 2011 - and its parallel co-investment fund agreed to buy 166 million shares at HK$1.23 apiece, the mid-point of the indicative range. Orchid Asia V was entitled to purchase up to HK$198.1 million in shares, while the co-investment vehicle could take up to HK$6.1 million. The Orchid vehicles are expected to own 8% of the company post-listing.

Cornerstone investors are subject to a six-month lock-up period.

Time Watch is mid-price watchmaker based in Hong Kong and controlled by chairman and founder Michael Tung Koon-Ming. It plans to use the offering proceeds to open approximately 60 points of sale by June and a further 200 in both 2014 and 2015. The company also wants to open 38 directly-managed concept stores in mainland China and establish joint ventures with watch retailers.

DBS was the sole global coordinator and book-runner for the deal, with CIMB acting as joint sponsor.

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• Topics
• Greater China
• Consumer
• IPO
• China
• Hong Kong (China)
• Orchid Asia Group Management
• Consumer