(Bloomberg) — Chinese energy-drink maker Eastroc Beverage Group Co. is close to hiring banks including Morgan Stanley and UBS Group AG to work on a second listing in Hong Kong, according to people familiar with the matter.
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Huatai Securities Co. is also likely to be involved, the people said. Other banks might be added to help with the offering, which could take place this year, the people said, asking not to be identified because the deliberations are private.
Bloomberg News reported in December that Eastroc is targeting a Hong Kong share sale to raise as much as $1 billion, joining a growing lineup of mainland-traded companies looking to do second listings in the Asian financial hub.
Discussions are ongoing and details such as size and timing of an offering could change, the people said.
Responding to a Bloomberg query, an Eastroc representative said “several leading investment banks” have suggested a share issuance in Hong Kong to support the company’s international expansion. While Eastroc has done some preliminary preparations, it hasn’t yet signed any cooperation or service agreements, the representative said.
Representatives for Morgan Stanley and UBS declined to comment. Huatai didn’t respond to requests seeking comment.
Eastroc’s Shanghai-traded shares have climbed about 76% in the past 12 months, even taking into account a slide this week. The company’s market value is 122 billion yuan ($16.7 billion).
Other mainland China-listed firms seeking a second trading foothold in Hong Kong include top battery maker Contemporary Amperex Technology Co. Ltd., condiment producer Foshan Haitian Flavouring & Food Co. and Jiangsu Hengrui Pharmaceuticals Co.
The trend has picked up since Chinese regulators slowed the pace of share sales on the mainland to prop up the stock market, prompting companies to seek funds offshore.
Founded in 1994, Eastroc sells drinks including vitamin energy and electrolyte beverages, Chinese-style sugar-free teas, coffee and coconut milk, according to its website. It has 12 production bases in China and nearly 3,000 distributors.
It had planned a sale of global depositary receipts in Zurich over two years ago, before Beijing tightened requirements on a program allowing Chinese firms to list on certain European exchanges.
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–With assistance from Dong Cao and Pei Li.
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