A 320.2 million share placement in Hong Kong listed Pacific Basin was priced yesterday (January 26) at HK$3.125, representing a tight 4% discount to a spot close of HK$3.35. This was also the tight end of a marketed range between 4% and 5% and aggressive in the context of both day's trading volume (74) and size of existing freefloat (34%).
The stock was sold by two VC investors that have just come out of their IPO lock-up. The two - IDB Carriers and Dry Bulk Shipping will see their stake drop to 16.6%, while the freefloat will expand to 61% and the remaining shares will be held by a variety of smaller investors including the company's management.
The $132 million deal saw books close five times covered with participation by 50 accounts. Lead manager was Goldman Sachs, also the IPO bookrunner last July.
Back then, the company raised $140 million deal after pricing its IPO at HK$2.50. Since then the stock has risen 34%, though it is down from its mid October peak of HK$3.975. Year-to-date it has traded in a band that has encompassed a low of HK$3.175 and high of HK$3.45.
Bankers believe strong take-up of the placement provides further proof that the Hong Kong stock market is coming back out of its recent doldrums, with investors keen to put money back to work. Pacific Basin is currently trading at about 5.2 times forward earnings.
