Legend Holdings targets $1.96b Hong Kong IPO
Legend Holdings, sponsor of China-focused GPs Hony Capital and Legend Capital, has set a pricing range for its Hong Kong IPO that would see the company raise as much as HK$15.2 billion ($1.96 billion).
Legend will sell 352.9 million shares at up to HK$43.00 apiece, according to a regulatory filing. The final offer price will be announced on June 26 and the stock is scheduled to commence trading on June 29.
The company is best known as the parent of Chinese computer manufacturer Lenovo Group. Other holdings span financial services, chemicals, property, agriculture and food, and modern services. It is also an LP in all of Hony and Legend Capital's funds - as well as owning interests in the GPs - and wholly owns start-up incubator Legend Star.
Legend Capital and Hony were set up in 2001 and 2003, largely at the instigation of Chuanzhi Liu, Legend's founder and president. This was done in recognition of the need for non-bank financing and demand for improved management and strategic vision in the public and private sectors as a result of economic reforms.
The prospectus identifies Legend Investment as the holding vehicle for Legend Capital. It has registered capital of RMB429.5 million ($69 million) and is 55.3%-owned by Legend Holdings.
As of December 2014, total commitments in Legend Capital's US dollar- and renminbi-denominated funds amounted to $1.63 billion and RMB7.19 billion, respectively. Hony has received commitments of $4.46 billion for its US dollar funds and RMB16 billion for its renminbi vehicles. Legend Capital closed its sixth US dollar fund at $500 million last year, while Hony is currently investing its fifth US dollar fund, which closed in early 2012 at $2.36 billion.
Since 2010, Legend has made strategic investments in sectors expected to benefit from consumption growth in China. These include car rental business China Auto Rental, dental chain Bybo, education-focused insurance broker Union Insurance, and fruit producer Joyvio.
Legend posted revenues of RMB288.9 billion in 2014, up from RMB243.6 billion the previous year. Net income rose from RMB7.71 billion to RMB7.82 billion over the same period.
Separately, Red Star Macalline Group, a Chinese shopping mall operator backed by Warburg Pincus, has announced plans to raise up to HK$7.2 billion. It will sell 543.6 million shares at HK$13.28 apiece. The company originally wanted to list in Shanghai but abandoned this effort after a protracted wait and opted for Hong Kong instead.
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