China’s Wanda raises $3bn ahead of Hong Kong IPO for property management unit – sources

HONG KONG, April 21 (Reuters) – Chinese conglomerate Dalian Wanda Group is aiming to raise 20 billion yuan ($3.08 billion) for its commercial property management business, before listing the unit in Hong Kong by the end of the year, said two people with direct knowledge of the sector. case told Reuters.

Wanda is primarily targeting private equity investors for Wanda Light Asset Commercial Management Co, targeting a valuation of 200 billion yuan, the people said.

Several potential investors approached by Wanda and its financial advisers, however, found the valuation “too high”, one of the people said.

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The conglomerate, owned by Wang Jianlin – once China’s richest person – aims to complete the fundraising by July and file an initial public offering (IPO) in September, they said.

Wanda Group did not respond to a request for comment.

The people declined to be identified because the information is confidential.

Chinese property developers and managers raised a record $10.4 billion in Hong Kong listings last year, Refinitiv data showed.

China Evergrande Group (3333.HK), Sunac China Holdings Ltd (1918.HK) and Shimao Group Holdings Ltd (0813.HK) all introduced property management businesses last year. All three are currently trading well above their IPO prices.

If Wanda were to sell a 10% stake – as is usually the case for a major IPO – then a valuation of 200 billion yuan would make Hong Kong’s biggest float for a property manager at least since 2016, surpassing November’s $1.8 billion float of Evergrande Property Services Group Ltd. (6666.HK).

The listing plan comes after the unit’s debt-ridden parent Wanda Commercial Management Group – China’s largest commercial property developer – withdrew a domestic IPO application in March, saying it would revamp its assets and would pursue a foreign listing.

The unit, responsible for managing 368 Wanda Plazas and 155 under construction, has secured 3 billion yuan in investment from the southern city government of Zhuhai, the parent company said last month.

One of the sources said the local government would count as a lead investor in the pre-IPO fundraising.

($1 = 6.4984 Chinese yuan renminbi)

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Reporting by Julie Zhu and Kane Wu; Editing by Christopher Cushing

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