Published September 23, 2009

Midas plans secondary listing in Hong Kong

Credit Suisse to help evaluate, prepare for the listing

By JAMIE LEE

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MIDAS Holdings said it has plans to apply for a secondary listing in Hong Kong, jumping on the bandwagon of S-chips eyeing dual listings to tap the speculative money being poured into the Chinese markets.

'We are optimistic that a listing on both the Singapore and Hong Kong bourses will allow us to tap into a wider investor base, increase liquidity and enhance our stock value,' said chief executive Patrick Chew in a press release.

'With our strong business focus in China, a secondary listing in Hong Kong brings us closer to our key market and will augur well for the group's long-term growth and development.'

The company, which makes aluminium parts used in railway trains in China, has not set a timeline for the dual listing on the Hong Kong mainboard.

It has appointed Credit Suisse (Hong Kong) to help evaluate and prepare for the listing.

'With our strong business focus in China, a secondary listing in Hong Kong brings us closer to our key market ...' - Midas CEO Patrick Chew

Shares of Midas trade at 21.8 times its current earnings, Bloomberg data showed.

The price-to-earnings ratio it commands is higher than that of its competitor China Zhongwang Holdings, which trades at 14.67 times its current earnings.

China Zhongwang's recent Hong Kong initial public offering (IPO), which raised about US$1.3 billion, made headlines for being one of the world's biggest IPOs this year.

More S-chips are turning their attention to the Hong Kong market, eyeing the soaring valuations offered there thanks to the easy money being pumped into the Chinese economy.

In August, Z-Obee Holdings, a mobile communications firm, said that it was looking into a dual listing in Hong Kong bourse, while China XLX Fertiliser announced that it has applied for a secondary listing.

Bank of Communications' international investment banking and securities arm - Bocom International Holdings - told BT recently that it was in talks with some S-chips to apply for dual listing in Hong Kong or a public offering following a de-listing from the Singapore Exchange.

Shares of Midas - which has a market cap of $864 million - hit a 14-month high of 91 cents yesterday before closing at 89.5 cents, up 3.47 per cent.