Hong Kong: Dalian Wanda Commercial Properties Co Ltd, the world’s second largest developer of shopping malls and office buildings, cut the size of its Hong Kong IPO by around a third to $3.9 billion (Dh14.3 billion) to lure investors worried about its huge debt, analysts said.
The company, backed by Chinese billionaire Wang Jianlin, launched the deal on Monday and offered 600 million new shares in a range of HK$41.80 — HK$49.60 each, according to a term sheet seen by Reuters.
It had earlier sought to raise as much as $6 billion via the deal, Reuters previously reported. Analysts said the company cut the IPO after some buyers were put off by the 179.7 billion yuan ($29.2 billion) in bond and loan debt it had amassed during a decade-long, rapid expansion drive.
Dalian Wanda’s gearing ratio, a measure of indebtedness, stood at 87.8 per cent at the end of June, according to its draft prospectus, more than double the industry average of 40-50 per cent, analysts said.
“Investors will be concerned about the debt,” said Alvin Cheung, associate director at Prudential Brokerage in Hong Kong.
The IPO is set to be priced on December 16. The share are due to list on December 23.
