SF Holdings eyes ‘backdoor’ listing
Print Edition
CHINESE courier company SF Holdings (Group) has struck a 43.3 billion yuan (US$6.6 billion) deal with a little-known metals company that effectively gives the firm known as “China’s Fedex” a backdoor route to a stock market listing.
With an eye on attracting investors as it lines up expansion overseas, SF Holdings has reached an asset swap and new share accord with Maanshan Dingtai Rare Earth & New Materials Ltd, the latter said in a filing to the Shenzhen exchange.
Under the terms of the deal, which is subject to regulatory approval, Dingtai will officially acquire SF, funding the purchase by issuing new shares to the courier.
Reinvented as a logistics company, Dingtai will then be controlled by SF, whose founder and Chairman Wang Wei will run the new business.
SF’s “backdoor listing” is the latest in a series of moves by big, privately held Chinese firms seeking a quicker route to a stock market presence than a time-consuming traditional initial public offering.
The plan by SF is the biggest such deal since digital advertising company Focus Media’s US$7.2 billion backdoor listing last year.
The planned move comes weeks after regulators unveiled plans to tighten scrutiny of companies seeking backdoor listings to benefit from top valuations in China’s mainland.
Trading in Dingtai shares, suspended since April 5, will remain halted pending further notice.
Dingtai last traded at a price-to-earnings ratio of 126 times, Thomson Reuters data showed, giving it a market value of about US$500 million.
SF, the main competitor in China for international courier firms like DHL and Fedex Corp, didn’t respond to requests for comment.
With logistics set to be a key development focus area for China in the coming years, its listing follows similar moves by smaller rivals YTO Express and STO Express.
Under terms of the deal, Dingtai also plans to sell new shares to 10 private investors, raising 8 billion yuan to upgrade logistics facilities.
CITIC Securities, Huatai United Securities and China Merchants Securities acted as financial advisers for the deal.
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