Uni-President China Holdings Ltd is expected to raise as much as HK$4.13 billion (US$531 million) in an initial public offering with its parent in Hong Kong.
Uni-President China, the mainland unit of Taiwan's biggest food and beverage maker, Uni-President Enterprises Corp, plans to sell 881.7 million shares at a price range between HK$3.75 to HK$4.68, its share-sale document said yesterday.
About 60 percent of the shares being offered in Uni-President China's IPO are new, while the rest were sold by the parent.
Shares are scheduled to start trading on December 17 and Morgan Stanley and UBS are helping to arrange the sale.
Uni-President China, which already has 13 factories and 530 sales offices in China with more than 300 products on sale, said the proceeds would be used to further expand capacity, broaden the distribution network and make strategic investments in China.
The Taiwan food and beverage giant is competing for bigger market share against United States rivals Coca Cola Corp and Pepsi Corp in the beverage market, as well as home rival Ting Hsin International Group in the instant noodle sector.
"The company's prosperity is still promising, propelled by huge market potential for diluted juices and tea drinks in China," said Tang Zhiqing, an analyst at Yiyan Business Consulting in Shanghai.
"In addition, the instant noodle products are still profitable despite the recent cost rise."
Uni-President China's income totaled 7.9 billion yuan (US$1.07 billion) by the end of last year, an compound growth of 17.7 percent from 2004.
Its net profit amounted to 260 million yuan for the first half of this year compared to 146.1 million yuan in the same period last year.
Drinks accounted for 70 percent of its sales revenue last year, while the instant noodles business has been growing slowly over the past three years due to intensified market competition and rising costs.
China's growing health awareness is spurring sales of non-fizzy drinks.
Uni-President is China's second largest juice maker with a market share of 29.1 percent in terms of sales, the company said, quoting market researcher ACNielsen. It also sells coffee, bottled water and yogurt to complete its products mix.
(Shanghai Daily December 5, 2007)