Deals and IPOs

Shares of Asia's largest logistics operator ESR Cayman jump 7% in Hong Kong debut

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Key Points
  • This was ESR Cayman's second attempt at a listing in Hong Kong, after it pulled its first one in June — when the ongoing unrest in the city first started.
  • Since then, brewer Budweiser APAC made its debut in Hong Kong in September — the world's second-largest this year raising $5.7 billion — and a development that ESR Cayman cited in explaining why the firm is bringing back its IPO.
Shipping containers stacked along the docking bay at a port in Singapore.
Roslan Rahman | AFP | Getty Images

Shares of logistics real estate developer ESR Cayman jumped in the company's debut in Hong Kong on Friday — the second-largest IPO in the city this year.

Its shares opened at 17.60 Hong Kong dollars ($2.25) a share, jumping 7% by late morning.

The company managed to raise $1.6 billion after pricing its IPO at HK16.80 per share — and around the midpoint of its expected range of between HK$16.20 and HK$17.40.

That was ESR Cayman's second attempt at a listing in Hong Kong, after it pulled its first one in June, just as the ongoing unrest in the city started.

At that time, ESR Cayman, the largest logistics real estate operator in Asia Pacific and backed by private equity giant Warburg Pincus, cited "current market conditions" for postponing the listing.

Speaking to CNBC on Friday before trading began, the firm's Chairman Jeffrey Perlman, said: "Sometimes you can't pick the geopolitical and macro environment, and when we really ... looked at the situation in June, it just wasn't the right time for the company." Perlman is also managing director and head of Southeast Asia at Warburg Pincus.

Brewer Budweiser APAC made its debut in Hong Kong in September. It was the world's second-largest this year raising $5.7 billion.

"What we found though, was that investors really wanted to see this as a public company. And I think with Budweiser coming back out (in) the market successfully, followed by Topsports, it really created a good window for the company to come back," he said.

Chinese sportswear retailer Topsports International also launched its IPO in October, raising $1.01 billion.

Perlman said the e-commerce market in Asia is still nascent, and that Southeast Asia is "the next frontier."

"If you think about what differentiates e-commerce companies today, it's actually not the goods that they're selling, but really more ... who can deliver the goods to the end-consumer the fastest ... Investors have been hugely positive of logistics," he said.