Millions from IPO for dairy expansion

China Youran Dairy Group wants to raise US $800 million in an IPO on the stock exchange in Hong Kong. The dairy group wants to invest 75% of the amount in buying or building dairy farms in China. 

This reports Channel News Asia. The IPO is scheduled for June 18 on the Hong Kong Stock Exchange. China Youran therefore wants to invest $600 million in expanding dairy farms. Of the amount, 15% ($120 million) is also intended for expanding the dairy herd. The remaining 10% ($80 million) will go towards increasing working capital. 

China Youran is therefore carrying out the IPO to further strengthen the raw material supply for dairy production by investing in Chinese dairy farming. The dairy company, backed by the private equity group PAG, plans to sell more than 715 million shares. If the IPO is financially successful, the company has secured an option to later sell more than 107 million.

This is not the entire stake in China Youran, which is pricing its shares at USD 6,98 to USD 8,66 each prior to the IPO. If the pieces sell for the highest price, China Youran is worth a total of about US$4,2 billion.

Eric the Thrush

Eric is a member of the editorial staff of Boerenbusiness. As a descendant of an arable family, farmer's blood flows through Eric's veins. He considers himself a generalist, but with a preference for economics, trends, markets and marketing.

e.delijster@boerenbusiness. Nl

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