Hong Kong, China (4E) – Temasek Holdings Pte. Ltd. is buying a multibillion-dollar stake in Hong Kong tycoon Li Ka-shing’s retail company, marking one of the Singapore firm’s largest-ever overseas acquisitions.
The Singapore-based state investment company is planning to pay 44bn Hong Kong dollars ($5.7bn) for nearly a quarter stake of A.S. Watson, which is owned by billionaire Li and also controls the ParknShop supermarket chain and Superdrug in the UK.
Watson’s 24.95 percent stake acquired by Temasek values Mr. Li’s retail business at 177bn Hong Kong dollars ($22.8bn).
The sale to Temasek allows the Hong Kong-listed group to partially unlock the value of its A.S. Watson-related businesses and set a valuation benchmark for the other interests of the group, according to a filing by Watson’s parent Hutchison Whampoa Ltd., through which Mr. Li also owns his global businesses in energy and ports.
The move is expected to push back plans of the drugstore-to-supermarket chain for a $6bn Hong Kong dollar and London initial public offering (IPO). The Hong Kong company and the Singapore state firm will work together to find the suitable time for Watson’s listing, said Hutchison.