Belle May Raise $1.1 Billion in Hong Kong Share Sale (Update2)
By Bei Hu
May 3 (Bloomberg) -- Belle International Holdings Ltd., China's largest retailer of ladies' footwear, may raise as much as HK$8.7 billion ($1.1 billion) in a Hong Kong initial public offering, said two people with direct knowledge of the matter.
The company and stockholders are offering about 1.4 billion shares, equivalent to a 17 percent stake, for HK$5.35 to HK$6.20 apiece, according to the people, who declined to be identified before an announcement. The range values the Shenzhen-based company at 27 times to 31 times estimated earnings for this year.
Belle, with about 3,828 footwear and sportswear outlets in China, is raising money to expand its retail network as well as production and warehouse capacity, according to a share sale document earlier sent to fund managers. Retail sales in the world's most populous nation jumped 15 percent in the first quarter from a year earlier as rising incomes stoked demand.
Consumption of mid- to high-end branded footwear and sports footwear grew an averaged 30 percent a year in the country in the five years to 2005, China International Capital Corp. said in a report on Belle dated April 20. Per capita footwear consumption, at 2.3 pairs in China, compared with 3.9 pairs in South Korea and 7.3 pairs in the U.S., leaves room for further increases, the Beijing-based investment bank said.
Sale Arrangers
Credit Suisse Group and Morgan Stanley are arranging the sale, which is due to close May 14. The shares will be priced on May 15.
Josephine Lee, a Hong Kong-based spokeswoman for Credit Suisse, and Po-ling Cheung for Morgan Stanley declined to comment.
Ivan Kau, an external spokesman for Belle and the company's Shenzhen-based officials couldn't immediately be reached.
Belle will sell about 1.16 billion new shares, with the rest of the stock being offered by shareholders, according to the earlier sale document. The share sale may be expanded by 15 percent to meet demand, the document said.
The company and its advisers will take orders for 90 percent of the IPO shares, reserved for international institutional investors, between May 3 and May 14. The remainder will be sold to Hong Kong individuals between May 9 and May 14, the term sheet said.
Chinese companies have raised $30.8 billion selling shares this year, excluding mutual-fund launches and rights offerings, with investors clamoring for stock offerings amid first-day gains that are all but guaranteed. Bank of Communications Ltd. drew $188 billion of orders for its Shanghai share sale, greater than the market value of JPMorgan Chase & Co.
To contact the reporter on this story: Bei Hu in Hong Kong at bhu5@bloomberg.net .
