Power Assets cuts size of trust IPO to US$3.6b

[HONG KONG] Li Ka-shing's Power Assets Holdings Ltd slashed the size of a Hong Kong initial public offering (IPO) of its electricity business by nearly one-third to US$3.6 billion because of a lower-than-expected valuation and its decision to keep a large stake in the business.

Power Assets will spin off the business into HK Electric Investments, a single-investment trust, offering 4.43 billion units in an indicative range of HK$5.45-HK$6.30 each, the company added in a filing to the Hong Kong stock exchange on Sunday. That would put the deal at up to HK$27.91 billion (S$4.6 billion).

The deal will be the first of several mega-sized offerings in the city in 2014, a year that could have some US$32.2 billion in new listings, advisory firm PwC estimated, nearly double the 2013 tally of US$17.1 billion.