PanAsialum to raise HK$1.22b in Hong Kong

PanAsialum, a major manufacturer of aluminium casings for Apple's iPad, plans to raise up to HK$1.22 billion from an initial public offering (IPO) in Hong Kong, the Shenzhen-based company said yesterday.

Aluminium parts for various Apple products have increased their share of the firm's portfolio over the past two years. It also produces aluminium door and window frames and other products for architectural uses.

Casings for iPads contributed 47 per cent of the company's revenues last year, up from 8.8 per cent in 2010.

Revenue in the fiscal year to September 30 reached HK$2.44 billion, compared with HK$2.09 billion the previous year.

Financial controller Yeung Chin-cheung said: "The robust growth in revenue is due to the fast growth in the electronics parts segment."

PanAsialum sells the casings to Taiwan-based Foxconn, the largest contract manufacturer for Apple products.

It established a business relationship with Foxconn in 2000 and is now the sole external supplier of unibody casings. It also supplies aluminium plates to Foxconn that are processed into parts for tablets and computers.

PanAsialum said it derived 34 per cent of its total revenue from sales to Foxconn.

Demand for tablet computers is expected to keep growing quickly for the next couple of years. Research firm IDC says in its latest forecasts that worldwide shipments of tablets will reach 172.4 million units this year and that by 2016 the number should reach 282.7 million.

PanAsialum is offering 300 million shares at a price between HK$3.46 and HK$4.50 that is expected to be fixed on January 29. The trading debut is scheduled for February 5.

Three-quarters of the proceeds will be used to expand capacity, to establish a new production line and relocate the main plant to a new site in Guangzhou. The remainder will be used for working capital and to repay bank loans.