Redsun Services Announces Pricing Range Ahead of Hong Kong Offering

Pricing at HK$3.80 a share, the property management firm would raise around HK$331.2 million.

Author: Anthony Russo   

The Chinese property management firm Redsun Services Group Ltd. announced Tuesday the pricing range ahead of its Hong Kong IPO.

The company intends to offer 100 million shares priced in the range of HK$3.30 per share and HK$4.30 per share, according to Redsun's statement today. Under the offering, 90% of the shares are for International sale, while 10% are reserved for Hong Kong; both of which are subject to reallocation. Assuming that it prices at HK$3.80 a share and it the over-allotment option is not used, it would raise around HK$331.2 million, according to the company. 

The sole sponsor on the deal is ABCI Capital Ltd.

Redsun plans to the use 40% of the proceeds for strategic investment and acquisition opportunities, 30% to improve research and development and upgrade intelligent systems, 10% to enhance service quality, 10% for the Recruitment of talent, improve employee training and employee benefits system and the remaining 10% for working capital and general corporate purposes.

The company operates in three sectors including property management, value-added services to non-property owners, and community value-added services. It has also been involved in expanding its property management services to third-party developers. Looking ahead, Redsun plans on continuing to expand in the Jiangsu province and enter more strategic cooperative deals with third-party property developers.

In the full year 2019, Redsun generated 502.99 million yuan in revenue compared with 257.14 million yuan in 2018. Total profits last year were 127.44 million yuan as compared to 69.77 million yuan in 2018.

Redsun will kick off the offering on Wednesday which will end on June 30 at 12pm. Final pricing is to be reported on July 6. Trading is set to begin on the HKEX on July 7, under the code 1971.

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