Hutchinson IPO

Hutchison makes waves with port trust IPO launch
Public offer closes on March 14, trading expected to begin on March 18

By EMILYN YAP AND JOYCE HOOI

(SINGAPORE) Singapore’s largest initial public offering (IPO) which was launched yesterday – a Hutchison Whampoa spin-off in the form of Hutchison Port Holdings Trust (HPH Trust) – is seeing ‘overwhelmingly enthusiastic’ response, even in a jittery equities climate that has not been kind to recent IPOs.

Based on the offering’s price range, the implied distribution per unit yield for the forecast period of 2011 is between 5.5 per cent and 6.5 per cent. Next year, this is expected to increase to between 6.1 per cent and 7.2 per cent.

SMALL investors are getting a chance to take part in what looks set to become Singapore’s largest initial public offering (IPO) – to raise up to US$5.8 billion (S$7.3 billion).

Hutchison Port Holdings Trust (HPH Trust), the Chinese ports unit of Hong Kong conglomerate Hutchison Whampoa, launched the public offer of its mega IPO at noon on Monday. Hutchison Whampoa is headed by Asia’s richest man Li Ka Shing. HPH owns booming ports in southern mainland China and Hong Kong.

Retail investors here are being offered 185.2 million units out of up to 3.9 billion units on sale in total. Investors have until 10 am next Monday to subscribe.

The final offering price will be set between 91 US cents and US$1.08, with pricing expected next Monday.

In the meantime, Singapore retail investors will have to pay $1.383 per unit – a price converted from the US dollar figure at the top of the range – and will get refunds if the IPO price ends up lower.

The trust is listing here as Hong Kong regulations do not yet allow for such business trusts. Its portfolio boasts ports in Hong Kong and Shenzhen in Guangdong province. Together they were the world’s busiest container port market in 2009.