Dali Foods Group, a Chinese snack and beverage producer, is seeking to raise as much as $1.34 billion in a Hong Kong initial public offering.
The company, which sells “Daliyuan” cakes and “Copico” brand potato chips, is offering 1.69 billion shares at HK$5 to HK$6.15 each, according to terms for the deal obtained by Bloomberg. Three cornerstone investors including Arisaig Partners have agreed to buy about $305 million of stock in the offering, the terms show.
Dali Foods, which is based in Hui’an in eastern China’s Fujian province, plans to price the share sale 13 November and start trading 20 November, the terms show. Bank of America Corp. and Morgan Stanley are joint sponsors and joint global coordinators of the offering.
China’s snack food market is expected to surge 72 per cent from last year to 598.6 billion yuan in 2019, according to the company’s stock exchange statement which cited Frost & Sullivan. The retail sales value of China’s non-alcoholic beverage market rose 16.7% to 962.6 billion in 2014 from 2009.
The company reported net profit in the six months ended June this year jumped 47 per cent to 1.52 billion yuan from a year earlier, according to the statement. Sales of the food and beverage products accounted for 55 per cent and 46 per cent of the total revenue respectively.
Dali Foods started exporting products to North America in second quarter of 2015 and plans to expand sales in overseas market such as Southeast Asia, according to the statement.
Bloomberg News, edited by ESM
