China Hongqiao plans HK listing to raise $2.2bn

CHINA HONGQIAO Group, the largest privately owned aluminium hydroxide producer in China, has launched the roadshow for its Hong Kong initial public offering, hoping to raise up to $2.2bn (£1.38bn).

The deal involves 1.74bn primary shares with a guidance price range set at HK$7.10-$9.90 (57p-80p), representing a 2011 price to earnings ratio of 7.23-10.08 times, according to a term sheet. Pricing is slated for 31 January.

JPMorgan Chase is the sole global coordinator, while Barclays Group, BNP Paribas, Bocom and ICBCI are joint bookrunners.

The listing is expected on 11 February.

Hongqiao plans to use the funds to increase production from the current one million tonnes of aluminium a year to nearly two million tonnes by the end of 2012.

Hongqiao is controlled by Shandong Weiqiao Pioneering Group, whose business includes textiles, thermal power and aluminium. The group is owned by Zhang Shiping and his family.