Wilmar's proposed China IPO moves forward with subsidiary's Shenzhen listing

There will be an approximate 10% of the total pro-forma share capital of YKA if the CSRC gives it the green light.

Wilmar International is set to take the next step of its proposed initial public offering (IPO) in China after the China Securities Regulatory Commission (CSRC) accepted its Yihai Kerry Arawana Holdings Co.’s (YKA) application for its proposed listing on the Shenzhen Stock Exchange.

YKA, a 99.99%-owned subsidiary of Wilmar incorporated in mainland China, is said to be one of the largest agribusiness and food processing companies in the country. Its business activities include the processing and sales of kitchen food, feed ingredients and oleochemicals in China.

Also read: Wilmar's China unit set for $12-13b market cap upon Shanghai IPO: analyst

Should the application for the proposed listing be approved by the CSRC, it is envisaged that there will be an IPO of new YKA shares of approximately 10% of the total pro-forma share capital of YKA, and there will not be any secondary offering.

The proceeds will be used to fund YKA’s capital expenditure requirements, Wilmar said. The proposed listing and IPO is intended to further the growth of Wilmar’s China operations by increasing its market visibility and awareness amongst current and potential customers, investors and the public in China in the agricultural and food processing sectors.

“As part of the proposed IPO, Wilmar will continue to retain its current number of shares held in YKA. Immediately post the proposed IPO, Wilmar is anticipated to hold 89.99% of YKA via its wholly-owned subsidiary, Bathos Company. YKA is and will remain a material subsidiary of Wilmar post listing and for the foreseeable future,” the firm explained.

Meanwhile, Wilmar has obtained approval from the Singapore Securities Exchange Trading (SGX-ST) for the restructuring and spin-off of YKA as part of the proposed IPO.