Business
China Cinda IPO Raises $2.5 Billion
HONG KONG — China Cinda Asset Management Co. raised US$2.5 billion in Hong Kong’s biggest initial public offering of the year, as investors piled into a “bad bank” that benefits from rising levels of soured loans in the country.
Cinda, which buys bad debt from banks and companies, priced its IPO at 3.58 Hong Kong dollars (46 U.S. cents), at the top end of an indicative range, after receiving more than US$65 billion in orders. The listing, the first in Hong Kong by a Chinese distressed-asset-management company, displaces Sinopec Engineering Group Co. 2386.HK 0.00% ‘s US$1.8 billion IPO as the city’s largest this year.
A rising stock market helped spur demand: The benchmark Hang Seng 0011.HK -0.79% Index, while down Thursday, has been benefiting from a return of funds into China stocks, which dominate the city’s stock market. It is up 2% in the past month, good for third in the region behind China’s Shanghai Composite Index, up 4.5%, and Tokyo’s Nikkei, up almost 7%.
But Cinda’s success is unlikely to be replicated throughout the market, say investors. Another IPO that priced Thursday, Qinhuangdao Port Co.’s US$561 million offering, priced at the low end of its IPO price range.
“The IPO market has been improving recently but it doesn’t mean all companies would do well,” said Linus Yip, chief strategist at First Shanghai Securities Ltd. in Hong Kong. “Only companies with unique business model and bright prospect would attract investors who are still selective in investing new offerings.”
Cinda offers uniqueness, as probably the first state-owned bad bank to list in a business usually dominated by hedge fund. The success of Cinda, which benefits as bad loans grow, will make the pending IPO by midtier Chinese bank China Everbright Co Ltd. less of a surefire success, say investors.
Already listed in Shanghai. Everbright Bank 601818.SH 0.00% has tried twice before to list in Hong Kong. In its latest effort, seeking up to US$2.8 billion, Everbright Bank plans to start taking orders Tuesday, having set a price range of HK$3.86 to HK$4.30, or 3.03 yuan to 3.38 yuan, for its sale of 5 billion shares. Its planned Dec. 20 listing would follow IPOs in past month by two other smaller Chinese banks, Bank of Chongqing Co. and Huishang Bank Corp. 3698.HK +0.56% —all going public as rising bad-debt levels loom in China.
Even if Everbright Bank prices at the top end of the range, Hong Kong is far short of regaining the crown it held for 2009 through 2011 as the world’s top IPO venue. Investors grew wary after a string of new listings underperformed the broader market. The Cinda and Qinhuangdao offerings pushed Hong Kong’s IPO volume for 2013 to US$15.6 billion, but that is good enough only for fourth place, according to Dealogic—behind the New York Stock Exchange, which has raised US$40 billion, Nasdaq and the London Stock Exchange.
Cinda sold 5.3 billion shares at HK$3.58, people familiar with the situation said Thursday. The indicative range was HK$3 to HK$3.58.
There was significant interest from investors seeking exposure to a company benefiting from China’s growing bad debts. The approximately US$65 billion in orders—according to other people familiar with the situation earlier—was 26 times what the company sought.
About US$20 billion in orders was received for the portion of the IPO offered to retail investors, initially about 5% of the 5.3 billion shares. That means it was oversubscribed by 160 times; the prospectus calls for the retail allotment to be raised to 20% of the total offering if the retail portion is more than 100 times oversubscribed. The shares available to institutional investors, who ordered about US$45 billion worth of shares, will be scaled back to 80% from 95%.
Even before the IPO was launched, 44% was sold to so-called cornerstone investors, which commit to holding their shares for at least six months after the listing. Among them were hedge fund Och-Ziff Capital Management Group OZM +0.79% LLC and private-equity firm Oaktree Capital Group LLC. .
Qinhuangdao Port, which is controlled by Hebei provincial government, sold 829.9 million shares at HK$5.25 each, people familiar with the situation said Thursday. The indicative range was HK$5.25 to HK$6.70.
Of the six companies to raise more than US$200 million in Hong Kong since October, just two companies are trading at least 5% above their IPO prices, according to Dealogic. Phoenix Healthcare Group Co., which raised US$220 million in November, is up 58% and real-estate developer Hydoo International Holding Ltd., which raised US$216 million, is up 9.8%.
The performance of the newly listed Chinese bank has been disappointing amid rising bad debt. Bank of Chongqing is down 2.7% from its IPO price, while Huishang Bank is up a bare 1.4%. Nonperforming loans in Chinese banking sector at the end of September totaled 564 billion yuan ($92.6 billion), up 18% from the year-earlier 479 billion yuan, according the China Banking Regulatory Commission, the country’s banking regulator
– WALL STREET JOURNAL
Business
Tinubu Moves To Transform Tragedy To Prosperity With Livestock Investment
Nigeria’s President, Bola Ahmed Tinubu is of the view that his administration’s renewed focus in driving international and local investments into livestock sector of the agricultural value-chain will end the crisis of farmer-herder clashes, eradicate hunger and poverty in addition to promoting economic prosperity.
President Tinubu said this Thursday in Rio de Janeiro, Brazil at the signing of a Letter of Intent between the Nigerian Government and the JBS S.A, one of the top three largest meat processing companies globally.
“What we are doing right now is that we are solving a problem that afflicted humanity in that part of Africa, clashes between farmers and migrating cows that have caused some life and bloodshed when there is a modern, civilized way to solve those problems and even bring a successful economy out of it.
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“We are trying to turn a situation of tragedy, hopelessness into economic opportunity, see through problems and see the opportunity that is involved in it.”
The Nigerian leader called on the company to see the considerable potentials in what he called the $2.5billion livestock investment opportunities in Nigeria, especially with its huge population and tap into it, given JBS S.A’s globally recognized expertise in the area of guaranteeing food security.
“We’ve heard so much about you in terms of the reputation, and we believe in the partnership we are forging today.
“Food security is extremely important. As we talk right now, there is hunger. However, there is huge hope. And you are one of those hopes that we are looking at.”
President Tinubu told the JBS top executives that Nigeria is ready to do business with them, assuring them of a good return on their investment.
Prior to his visit to Brazil, President had commissioned a team of Nigerian officials and private sector players to take the advantage of the G20 Leaders’ Summit in Rio to conduct a study tour of Sao Paulo, Brazil and explore the opportunities in livestock development, meat processing, seed development and multiplication for key grains.
In his remarks, the Minister of Livestock Development, Idi Muhktar Mahia, who led the delegation, reported to the President that the team embarked on guided, extended and intensive tours of companies on the scale of their global reach, the integrated nature of their operations as well as the deployment of advanced technology. He added that from their interactions with various companies, JBS S.A. was chosen being the second largest meat processing company in the world with the capacity to process 33,000 cattle daily and over eight million birds daily, using advanced zero-waste practices. The company employs over 200,000 people across its subsidiaries in more than 50 countries in the world including United States, Canada, Mexico, Saudi Arabia among others.
Wesley Batista, founder and President of the JBS group, said the company is the largest employer of labour in Brazil with over $79 billion dollars revenue already in year 2024.
“We are glad to work with Nigeria to work together to develop the livestock industry there. We think it’s a good opportunity for our business in Nigeria and Africa as we believe Nigeria can be the center of supply of protein to many countries in Africa. We look forward to working with you. We are almost in December and this year is almost gone. We hope to be in Nigeria as soon as possible,” the founder and Chief Executive said.
Other members of the delegation included Minister of State Agriculture and Food Security Hon. Aliyu Sabi Abdullahi, Co-chairman Presidential Livestock Reform Committee, Professor Attahiru Jega, the Secretary of the Committee, Professor Mohammed Kuta Yahya, and the Chief Executive Officer of Nigerian Investment Promotion Council, Aisha Rimi.
Business
NANTA Champions Nigeria’s Tourism Revival With ₦742m Investment
The National Association of Nigeria Travel Agencies (NANTA) has disclosed an investment of ₦742 million over the past three years to position Nigeria as a premier tourism destination at the annual World Travel Market (WTM) in London.
Speaking in Lagos on Thursday, NANTA’s immediate past president, Mrs. Susan Akporiaye, revealed that the funds were used for exhibition pavilions, magazine publications, and logistical support for members attending the prestigious trade show.
“In three years, NANTA has spent ₦742,226,100 to deliberately put Nigeria on the global tourism map at the WTM. This was achieved with only skeletal support in 2022 and 2023,” Akporiaye said.
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According to Akporiaye, the association received minimal support in its early years of participation.
In 2022, La Campagne Tropicana Beach Resort and Air Peace contributed by placing advertisements on the Nigerian pavilion and in the association’s magazine. By 2023, Ibom Air joined the effort, supporting NANTA with adverts, while La Campagne Tropicana maintained its support.
The 2024 edition, however, marked a turning point. Akporiaye noted that for the first time, Ibom Air went beyond advertisements to co-exhibit, alongside Eko Hotels and Sabre Travel Network. Their contributions made Nigeria’s representation at WTM more robust and impactful.
“Sabre Travel Network also supported us, so we had their graphics, as well as Ibom Air’s, displayed on our stand. Their contributions made our 2024 participation very grand,” she added.
Akporiaye highlighted that 90% of the funds for WTM participation came directly from NANTA members, underscoring their commitment to Nigeria’s tourism development.
“This shows that we are true patriots, and we deserve national recognition for our efforts,” she said.
NANTA began attending the WTM in 2022 to fill the gap left by Nigeria’s absence from the event for over 10 years.
The association saw the need to promote the country’s tourism potential and create international business opportunities for its members.
“It’s been a wonderful and successful three years that NANTA has participated in WTM, filling the gap left by Nigeria’s absence for over 10 years. We are glad to have handed over the baton of Nigeria’s participation at WTM to the Nigerian government this year,” Akporiaye said.
Through its participation, NANTA has secured affiliations with international tourism boards, organized product training for members, and raised awareness about Nigeria as a destination.
These efforts have also led to partnerships with global airlines and travel boards, fostering significant growth for members’ businesses.
“Our participation at WTM has helped members’ businesses grow significantly. We have formed partnerships with airlines and travel boards worldwide.
“Our greatest achievement at WTM is drawing Nigeria’s attention back to the need to exhibit at the global travel market,” Akporiaye said.
The initiative has also inspired members to expand their horizons into global Meetings, Incentives, Conferences, and Exhibitions (MICE) events.
Business
CSR: Dangote Cement Fuels Education With Support Projects At Lagos Schools
Dangote Cement Plc, a leading cement manufacturer, has donated multi-million Naira educational support projects to secondary schools in Lagos as part of its social investment initiatives.
The company in a statement explained that the move is aimed at complementing the government’s efforts in providing quality and sustainable education in the state.
It was gathered that the projects were commissioned and handed over to various schools in the Ikoyi-Obalende Local Council Development Area, align with the Sustainable Development Goals (SDGs) on education. These goals focus on ensuring inclusive, equitable, and quality education, as well as promoting lifelong learning opportunities for all.
The projects, warmly received by both teachers and students, include 100 dual school desks for Ilado Community Junior High School and Wahab Folawiyo Senior High School, alongside a refurbished and fully equipped Chemistry Laboratory at the Government Senior Secondary School, Ikoyi.
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Also donated were reading tables, chairs, and bookshelves for the library at Government Junior Secondary School, Ikoyi.
A celebration also took place at Falomo Junior High School and Ireti Senior Grammar School, both in Ikoyi, where the company donated 20 brand-new desktop computers to the ICT departments of the schools.
At the event at Government Junior College, Ikoyi, the Group Managing Director of Dangote Cement Plc, Arvind Pathak, explained that social investment is a key part of Dangote Cement’s operations.
He said the company is dedicated to giving back to society and supporting the sustainable development of local communities, especially in areas where it operates.
Pathak’s address was delivered by Wakeel Olayiwola, the Head of Social Performance at Dangote Cement Plc.
He said, “education holds a pivotal role in the development and empowerment of the youths in the country. As a cornerstone for societal advancement, it serves as a critical tool for personal growth, economic development, and national progress. An educated youth population not only fosters individual success but also contributes significantly to the nation’s overall wellbeing.
“At Dangote Cement, we believe that providing quality education to our youth is vital and should not be left solely as the government’s responsibility. Thus, we aim to partner with the government to enhance educational development in this regard.
“The projects we are handing over today are part of our 2024 Corporate Social Responsibility (CSR) programme for selected schools within the neighbourhood of Dangote Cement Plc’s Head Office in Ikoyi, Lagos. These projects were selected based on need assessments in collaboration with the schools.”
As a responsible corporate entity, Pathak noted that Dangote Cement’s commitment to societal wellbeing, with investments in four key areas: Education, Healthcare, Infrastructure, and Economic Empowerment programmes.
“This year, our plants in Ibese, Ogun State; Obajana, Kogi State; Gboko, Benue State; Okpella, Edo State; and our Pan-African operations have launched several social investment projects. These efforts contribute to the quality of life in our host communities and support sustainable national development,” he added.
Pathak thanked the Lagos State Government, the Tutor General/Permanent Secretary, and the school management teams for their collaboration in identifying the schools’ needs and ensuring the timely completion of the projects.
Dr. Idowu Olufunke Oyetola, Tutor General and Permanent Secretary of Education District 3, Lagos State Ministry of Education, who was represented by Bolaji Rotimi Ajayi, Director of School Administration, praised the long-standing partnership with Dangote Cement, noting that the schools selected for the donations were fortunate beneficiaries. “We hope for more collaborations that will positively impact education,” she added.
The principals of the recipient schools expressed their gratitude after the formal handover of the projects.
Odunlami Olubunmi, Principal of Ilado Community Junior High School, Ikoyi, thanked Dangote Cement for the new desks, stating that the donation would significantly improve the learning environment for the students, helping to prepare them for a brighter future.
Bamidele Ayotunde, Principal of the school with the refurbished laboratory, urged other businesses to follow Dangote Cement’s example in supporting local schools, pointing out the positive impact of the laboratory’s renovation on the school’s learning environment.
The Principal of Ireti Senior Grammar School, Ikoyi, whose school received the new desktop computers, described the donation as a positive development and expressed hope for more support in the future.
Pupils also shared their appreciation for the contributions. Abiola Jamaudeen, a lab prefect at Government Senior College, Ikoyi, promised that the laboratory would be used to its fullest potential and well-maintained.
Lawal Rumayzo Abdulsalam, a student at the school, said the new library equipment would foster better reading habits and create a more conducive environment for learning, ultimately preparing them for success. Some students even performed special songs to welcome the Dangote team to their schools.