Pork producer WH lowers IPO price range

WH Group, the Sino-US pork producer formerly known as Shuanghui International, is marketing its US$6 billion share sale in Hong Kong at a lower valuation than previously sought amid a tepid market, people familiar with the deal said.

The world's largest pork company, based in Henan province, has kicked off pre-marketing for its initial public offering after it received approval from the Hong Kong stock exchange last week.

The indicative price range is likely to be between 15 and 18 times forecast earnings for this year, as against the 20 times the firm's senior management had indicated earlier, the sources said.

"Investors have shown keen interest and positive feedback on the Shuanghui deal given its size and investment story," one of the sources said. "The latest marketing range is more realistic given current listing conditions."

While the flotation would potentially give WH's private equity investors an opportunity to exit, it is still unclear how many shares the existing shareholders - such as CDH Investments, Goldman Sachs, New Horizon Capital and Temasek - plan to offload during the global offering.

Shanghai-based CDH, one of the mainland's biggest private equity firms, is the biggest shareholder, with a 33.7 per cent stake held in four funds, Shuanghui's 2012 annual report shows.