Gelonghui (02529) Hongying City ServiceParipesacasino(HK) announced that the company intends to issue 40 million shares globally, 4 million shares in Hong Kong, China and 36 million shares in the international placement; an offering from May 8 to May 13, 2024, with an expected pricing date of May 14; the offering price will be HK $3.20-HK $3.60 per offer share, 1000 shares per lot; China International Capital Corporation is the exclusive sponsor; the shares are expected to be listed on the main board of the Stock Exchange on May 17, 2024.
The company is a state-owned city service and operation provider, the business operation is mainly located in Changsha City, Hunan Province. The company provides a wide range of customersParipesacasinoTo create a cohesive business layout rooted in the urban area. According to service characteristics and industry standards, the services provided by the company can be divided into three categories: (I) property management services (including various property management services and value-added services for public, commercial and residential properties); (ii) urban services (including landscaping and engineering, lighting system operation, car park operation and municipal sanitation services); and (iii) commercial operation services. The company enjoys a reputation in the local market by serving all kinds of owners and developers, and the company's future depends on the relationship between the company and these owners and developers, in particular, the relationship established by the Changsha local government and its associated entities, public institutions and other state-owned enterprises.
The Company has entered into five cornerstone investment agreements with five cornerstone investors on 25 April 2024, under which the cornerstone investors have agreed to subscribe for a certain number of offer shares at a certain amount of investment at the issue price subject to certain conditions. Assuming that the offer price is HK $3.40 per offer share (i.e. the median of the indicative offering price range), the total number of offer shares that cornerstone investors will subscribe for is 19.706 million shares. Cornerstone investors include (I) Lance Technology (300433) (Hong Kong) Limited ("Lance Hong Kong"), (ii) Liad (300296) (Hong Kong) Limited ("Liad Hong Kong"), (iii) San'an International Holdings Limited ("San'an International"), (iv) Xiangzheng Investment Co., Ltd. ("Xiangzheng Investment") and (v) Hong Kong Jiagang Trading Co., Ltd. ("Jiagang Trading").
Assuming the offering price of HK $3.40 per share (i.e. the median of the indicative offering price range as set out on the cover of this prospectus), the Company estimates that the net proceeds from the global offering will be approximately HK $93.3 million. The company intends to use about 29.2% of the net proceeds expected from the global sale to identify potential strategic acquisition opportunities for property management service providers and urban service providers (mainly in Hunan, Jiangxi and Guizhou provinces). Maximize the potential advantages of collaboration with the company's existing business operations and promote the company's business development About 21.0% will be used for the purchase of municipal sanitation services and lighting system operation services vehicles and equipment to gradually enhance the company's service capacity; about 25.2% is expected to be used for further technological development in the next four years to enhance the company's technical capabilities, and increase the degree of digitization and automation; about 15.3% is expected to be used to continue recruitment and improve staff training to support the sustainable development of the business. And about 9.3% are expected to be used for working capital and other general corporate purposes.
