Warburg-backed ESR likely to raise $1.6b in Hong Kong IPO

(L-R) ESR Cayman co-founder and co-CEO Stuart Gibson, ESR chairman and Warburg Pincus managing director and head of Southeast Asia Jeffrey Perlman, and ESR group chief financial officer Wee Peng Cho.

ESR Cayman Ltd., a logistics real estate developer, is set to raise $1.6 billion as it’s planning to price its initial public offering at the middle of a marketed range, people familiar with the matter said.

The company and shareholders including Warburg Pincus LLC and Goldman Sachs Investments Holdings (Asia) Ltd. could price the shares at HK$16.80 apiece, the people said. The shares were marketed at HK$16.20 to HK$17.40 each.

An upsize option to sell an additional 15% of shares will be exercised in full, said the people, asking not to be identified because the information is private. That would increase the total number of shares sold to about 752 million, based on Bloomberg calculations.

The pricing marks a turnaround for ESR, which in June postponed an attempt to raise as much as $1.24 billion, citing unfavorable market conditions. Budweiser Brewing Company APAC Ltd. pulled its first IPO try in July, further denting investor confidence. At $1.6 billion, ESR’s offering is set to trail only Budweiser’s $5.8 billion share sale, according to data compiled by Bloomberg.

A representative for ESR declined to comment.

ESR’s offering attracted the Ontario Municipal Employees Retirement System as a cornerstone investor, with the Canadian pension fund agreeing to subscribe for a total of about $585 million of stock, terms for the deal showed. APG Asset Management, General Electric Pension Trust and JD.com Inc.’s Jingdong Logistics Group Co. are among the seven holders selling shares in the IPO.

ESR’s listing will boost Hong Kong’s IPO volume, which has slumped 43% to $18.7 billion this year, data compiled by Bloomberg show. Despite ongoing anti-government protests and the U.S.-China trade war, the city has been enjoying a good market window, with two billion-dollar-plus listings up at least 10% from their offer price and a number of small-cap IPOs popping on their debuts.

ESR plans to use the IPO proceeds to repay debt, develop logistics properties, and make co-investments in the funds and investment vehicles it manages, according to the prospectus.

ESR’s shares begin trading in Hong Kong on Nov. 1. Deutsche Bank AG and CLSA Ltd. are joint sponsors for the offering.

Bloomberg

Singapore Reporter/s

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Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.