Mallesons Stephen Jaques has advised Chinese coal and coke producer Hidili Industry International Development Limited (Hidili) on its HK$4.1 billion (US$525 million) global offering and listing on the Main Board of the Hong Kong Stock Exchange.

Hidili is one of the largest integrated coal producers by turnover in Southwestern China. The global offering consisted of a public offer in Hong Kong and an international placement pursuant to Regulation S and Rule 144A under the US Securities Act. The Hong Kong public offer was over-subscribed by approximately 670 times and the international offering was significantly over-subscribed.

Mallesons advised Hidili on the Hong Kong law aspects of the listing and worked closely with PRC counsel to carry out a group restructuring in preparation for the IPO. The Mallesons team also assisted in structuring a pre-IPO investment, through the issue of convertible notes, by Barings Private Equity Asia.

The offering was also supported by four cornerstone investors who bought shares at an aggregate value of US$80 million. The cornerstone investors include a company of which Dr. Lee Shau Kee is a substantial shareholder, a company owned by Chairman of Bank of East Asia, Limited Dr. The Hon. Sir David Li Kwok-po, Chairman and Chief Executive Officer of Chinese Estates Holding Limited Mr. Joseph Lau Luen-hung and a company which is a trustee for the benefit of Mr. Kuok Hock Nien and all members of the Kuok group companies.

Conrad Chan was lead partner on the deal, supported by lawyers April Kwong and Bonnie Cheng. Conrad Chan commented: “After a period of global market uncertainty, we are seeing Chinese issuers returning to tap the Hong Kong equity market.”

“In this deal we were able to use our substantial experience in helping Chinese companies list abroad. We guided our client through the entire process of due diligence, pre-IPO financing, restructuring and listing to achieve a successful capital raising that will support its expansion plans.”

Managing Partner, China Larry Kwok added: “Our work on this highly-anticipated IPO reinforces our reputation for being one of the leading ECM (equity capital markets) practices in Hong Kong. Our lawyers have advised on approximately 100 IPOs on the Hong Kong Stock Exchange, many of which involve interests and assets located in the PRC.”

In another recent IPO, Mallesons acted as Hong Kong counsel to Sichuan Xinhua Winshare Chainstore (“Sichuan Xinhua Winshare”) on its HK$2.1 billion (US$269 million) global offering and listing on the Main Board of the Hong Kong Stock Exchange. Sichuan Xinhua Winshare is the first Chinese bookstore operator to launch an IPO in Hong Kong. Partner Dieter Yih led the deal, supported by lawyer Veronica Chow.