Good as gold: Laopu Gold launches US$350 million share placement as demand surges
The Beijing jeweller will issue 3.7 million new shares at a 4.5 per cent discount to Tuesday’s closing price in its second major fundraising
Chinese jeweller Laopu Gold is raising HK$2.72 billion (US$350 million) through a new share placement in Hong Kong – its second such fundraising this year – as it looks to build inventory ahead of the peak shopping season amid high gold prices.
The Beijing-based company planned to issue about 3.7 million new shares at HK$732.49 each, representing a 4.5 per cent discount to Tuesday’s closing price of HK$767, according to a filing with the Hong Kong stock exchange on Wednesday.
The new shares would account for about 2.1 per cent of Laopu’s enlarged share capital once the placement was completed on October 30.
Laopu said 70 per cent of the proceeds would go towards inventory reserves, 20 per cent to working capital and 10 per cent to store expansion.
The company said it planned to build inventory ahead of the peak holiday season, noting that a rise in gold raw material prices had further increased procurement costs.
The placement followed Laopu’s HK$2.7 billion fundraising in May, underscoring a surge in equity financing activity in Hong Kong’s capital market over the past year.