(MENAFN - AFP) Chinese pork producer WH Group has slashed a planned initial public offering in Hong Kong by almost two-thirds blaming concerns about the strength of the city's stock market, a report said Wednesday.
The firm, which last year bought US giant Smithfield Foods in a landmark multi-billion-dollar deal, said this month it hoped to raise up to US$5.3 billion with a share sale and listing on April 30.
It would have made it the biggest IPO globally in a year and Hong Kong's largest since US insurer AIA raised $20.5 billion in 2010.
However, it now plans to raise up to US$1.88 billion and list on May 8, Dow Jones Newswires said, citing people close familiar with the situation. It said they had indicated that the company made its decision based on market volatility.
"Considering their fundraising needs and also the selling shareholders' expectations on the company's valuation, they decided to cut the offering size," the report cited one of the people as saying.
The firm, the world's largest pork producer, will reduce the amount of shares on the offer to 1.3 billion from 3.7 billion as originally planned, although it will keep its price range unchanged at HK$8.00-HK$11.25 (US$1.03-US$1.45), the report said.
The news will come as a blow to Hong Kong's stock exchange, which has been struggling to regain its appeal as a public listings destination after being eclipsed by other bourses in 2012 as the world's largest IPO venue.
It was dealt a blow in March when Alibaba, the world's largest online retailer, opted to list in New York instead of the southern Chinese city following a disagreement over the type of stock it could issue.
The city's benchmark Hang Seng Index is down 3.5 percent this year -- one of Asia's worst performers -- dragged by a slowing Chinese economy. It fell almost one percent on Wednesday.
Henan-based WH Group, formerly known as Shuanghui International Holdings, is involved in the production, slaughter and distribution of the meat, a key ingredient in Chinese cuisine. It is also a shareholder of Spanish meat firm Campofrio Food, according to its website.