China's largest pharmaceutical products distributor, Sinopharm Group Co Ltd, is set to raise up to HK$8.73 billion ($1.13 billion) in an initial public offering of shares in Hong Kong, according to a term sheet seen by Reuters on Friday.
Sinopharm is selling 545.68 million H-shares at a price ranging from HK$12.25 to HK$16 apiece with an over-allotment option to issue additional shares representing 15 percent of the offering, the term sheet showed.
The price range translates into a valuation of 19.5 to 25.5 times the company's projected 2010 earnings, based on the syndicate consensus, a source close to the deal said. Some 90 percent of the shares are for international placement with the remainder for public subscription. The company will kick off a roadshow on Friday and the shares will be priced on Sept. 15 and trading is expected to begin on Sept. 23.
UBS AG, CICC and Morgan Stanley are joint bookrunners of the deal. Citigroup and Deutsche Bank are the joint leads.
According to a source close to the matter, there are nine cornerstone investors, seven of which plan to invest $25 million each. The seven are: Singapore's GIC, China Life, Bank of China's BOCI, China Construction Bank's CCB International, global hedge fund Och-Ziff, investment fund Martin Currie, and Value Partners.
Bank of East Asia's chairman David Li and China Chengtong's parent company plan to invest $10 million each, the source said.
(Reporting by Alison Lui, Donny Kwok and Michael Flaherty; editing by Jacqueline Wong)