China-based Shuanghui International Holdings, which has proposed to purchase Smithfield Foods Inc for US $4.7 billion, is intending to have the combined company listed in Hong Kong. People knowledgeable about the transaction said that the planned listing while take place once the takeover is completed.
The unnamed sources also said that a US $4 billion Hong Kong initial public offering would permit the merged companies to trade in a market that would place a higher stock valuation than the U.S. or some other exchanges.
A Reuters report said that Hong Kong is more international stock market and far larger compared with Shenzhen. Shenzhen is the Chinese stock exchange where the main publicly traded subsidiary of Shuanghui is listed. Should the Hong Kong listing push through, Shuanghui's private equity investors would be given an ideal exit route if they choose to trade their holdings.
However, the deal with US pork producer Smithfield has yet to be closed. Thus, all plans about what happens following the takeover would be concluded upon the deal's completion.
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