(Bloomberg) -- China Resources Holdings Co. is meeting some resistance on the potential valuation for its beverage unit in a planned initial public offering in Hong Kong, people familiar with the matter said.
Prospective investors are seeking a discount to the valuation target of as much as $6 billion for China Resources Beverage Holdings Co., the people said, asking not to be identified as the information isn’t public. The pushback partly follows a slump in the share price of competitor Nongfu Spring Co., they said. Nongfu is down 34% since the start of May.
A representative for China Resources Beverage, which owns the C’estbon water brand among others, declined to comment.
The planned IPO, which the China Securities Regulatory Commission approved on July 10, is one of the most highly anticipated in Hong Kong this year. Bloomberg News previously reported that it could raise about $1 billion. The company is still aiming to raise that amount, though deliberations are ongoing and no final decisions have been made, the people said.
Hong Kong IPOs have raised about $2.3 billion this year, down about 15% from the same period in 2023, data compiled by Bloomberg show. With activity in the Asian financial hub and mainland China subdued, authorities have pledged more support, including speeding up the approval process for new share sales.
--With assistance from Shirley Zhao.
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