Shuanghui plans Hong Kong IPO after Smithfield deal
China’s Shuanghui International, which has agreed to buy US pork producer Smithfield Foods for US$4.7 billion (HK$36.46 billion), plans to list the combined company in Hong Kong after completing the takeover, people with knowledge of the matter said.
China’s Shuanghui International, which has agreed to buy US pork producer Smithfield Foods for US$4.7 billion (HK$36.46 billion), plans to list the combined company in Hong Kong after completing the takeover, people with knowledge of the matter said.
A Hong Kong IPO, valued at around US$4 billion, would allow the merged group to trade in a market that would place a higher valuation on the stock than the US or other exchanges, the sources said.
Hong Kong is a far bigger and more international stock market than Shenzhen, the Chinese exchange where Shuanghui’s main publicly traded subsidiary is listed.
A Hong Kong listing would also offer an ideal exit route for Shuanghui’s private equity investors, which includes Goldman Sachs and New Horizons, when they decide to sell their holdings, according to the people familiar with the matter.
New Horizons is the private equity firm founded by Winston Wen, the son of China’s ex-Premier Wen Jiabao.
Shuanghui could also use the proceeds to pay down some of the debt, people familiar said.
