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Private Equity

Volatility threatens IPO by private equity firm

PAG, an Asia-focused private equity firm backed by industry giant Blackstone, is considering a delay of its planned initial public offering in Hong Kong amid market volatility.

The firm, led by Chinese dealmaker Shan Weijian, is now thought likely to make its debut in 2023.

It was also said by insiders that PAG is keen to avoid the sale taking place against a backdrop of stock market volatility because that could potentially lead to investors demanding steep discounts and also result in weak trading during the early days after a listing.

The firm’s offering had been expected to raise as much as US$2 billion (HK$15.6 billion).

This looming postponement came as a doubt surfaced about China Tourism Group Duty Free Corp being able to attract enough retail subscriptions for a Hong Kong IPO worth up to HK$17 billion, which would be the largest share sale in the SAR so far this year.

Apart from the continuing market volatility, analysts said its business in Hainan has been hit by the latest Covid outbreak, which has dragged down the travel retailer’s A shares, and that would affect its offering in Hong Kong.

Meanwhile, Chinese smart pharmacy chain Dingdang Health Technology appears poised to start its book building by the end of the month at the earliest.

It aims to raise up to US$100 million in the share sale.

And property management firm Suxin Joyful Life Services (2152) has reportedly priced its Hong Kong IPO at HK$8.6 per share – the bottom end of the indicative range. So it would be raising about HK$215 million through the share sale.

Bloomberg and staff reporter

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