SF Holding to raise US$340m through listing of its Reit unit

CHINESE logistics giant SF Holding is looking to raise US$340 million through a listing of its unit, SF real estate investment trust (SF Reit), in Hong Kong.

It is offering some 520 million units ranging from HK$4.68 (S$0.81) to HK$5.16 each. The company had started book building on Wednesday and expects to list the Reit on May 17.

At maximum deal size, the initial public offering (IPO) will be the largest Reit or business trust IPO in Hong Kong since 2014.

The successful listing of the Reit will also make it the first Reit IPO in Hong Kong since 2019 and the first logistic Reit there.

The shares, to be listed on the mainboard of the Stock Exchange of Hong Kong (SEHK), comprise around 468 million shares under the international offering and 52 million shares under the Hong Kong public offer, representing 10 per cent of the initial offering size.

This will give it an implied market capitalisation of about HK$3.7-HK$4.1 billion. State-owned China Orient Asset Management and a Canada-based investment fund CI Global Asset Management will go on board as cornerstone investors and will each subscribe to US$25 million worth of Reit units.

Based on the maximum offer price of HK$5.16 per unit, gross proceeds are estimated to be HK$2.9 billion. In addition, proceeds will also be raised from HK$1.4 billion from units issued to the vendor and a bank loan drawdown which amounting to HK$1.8 billion.

The proceeds will be used for acquisition of predecessor group, transaction costs and general corporate purposes,

DBS is the sole listing agent, joint global coordinator, joint bookrunner and joint lead manager on the transaction.