Jinmao, Yida Plan Hong Kong Listings

By Prudence Ho 

HONG KONG--A hotel trust whose assets include the Grand Hyatt Shanghai and a business park developer joined a number of Chinese companies capitalizing on Hong Kong's stock market surge in recent weeks with planned initial public offerings raising up to US$900 million in total.

Jinmao Investments and Jinmao (China) Investments Holdings Ltd. started taking orders for its up to US$437 million Hong Kong IPO on Monday, while Yida China Holdings Ltd, a business-park developer, has kicked off a sale of up to US$217 million for its float with half of the deal already taken by cornerstone investors who have agreed to hold shares for six months once the firm has listed.

The two potential listings join two other smaller firms--online gaming firm Ourgame International Holdings Ltd., and software provider Chanjet Information Technology Co.--which are raising a combined US$240 million before listing in the city by the end of June.

The planned listing of these companies comes after a more-than-5% jump in Hong Kong's Hang Seng Index since May 1.

Jinmao is seeking to sell 600 million share-stapled units in a range of HK$5.35-HK$5.65 each (US$0.69-US$0.73), according to a term sheet seen by The Wall Street Journal. These stapled securities include units in a trust linked to shares in the company that holds the trust's underlying assets.

Four cornerstone investors, including private-equity firm Warburg Pincus LLC, have committed to buying a total of US$40 million, or around 10% of Jinmao 's IPO, the term sheet said. It plans to list on the Hong Kong Stock Exchange July 2.

Jinmao trust's assets will include six completed hotels in mainland China, including The Westin Beijing Chaoyang and JW Marriott Shenzhen, as well as two under development, the Renaissance Beijing Wangfujing Hotel and Grand Hyatt Lijiang. Grand Hyatt Shanghai is part of Jin Mao Tower, a mixed-use development that includes offices and retail space that will also be included in the trust.

Three other Hong Kong-listed companies have used a stapled-unit structure. They include HKT Trust, the telecommunications trust which was spun off from PCCW Ltd. in 2011, and Langham Hospitality Investments Ltd., a hotel trust backed by Great Eagle Holdings Ltd. that listed last year.

The third, HK Electric Investments, an investment trust controlled by Power Assets Holdings Ltd., raised US$3.11 billion in a January IPO.

Separately, Yida China Holdings Ltd. is selling 580 million shares in an indicative price range of 2.30-2.90 Hong Kong dollars each, representing 4.5 times to 5.7 times 2014 forecast earnings, according to term sheets seen by The Wall Street Journal.

Yida has secured a total of US$106.3 million, or almost half of the deal, from six cornerstone investors including China Cinda Asset Management Co, which is buying US$40 million worth of shares, and China Huarong Asset Management Co, which is buying US$30 million, the term sheets said.

The business-park developer will price the deal June 20 and it is scheduled to list in Hong Kong on June 27, the term sheet said.

Write to Prudence Ho at [e-mail] and Yvonne Lee at [e-mail]

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