Chinese retail tycoon’s Wumei considers Hong Kong IPO

HONG KONG: Wumei Holdings Inc, the Chinese retail group that owns one of the country’s biggest supermarket chains, is considering an initial public offering (IPO) in Hong Kong, people with knowledge about the matter said.

The Beijing-based company has held preliminary talks with potential advisers about a listing, according to the people, who asked not to be identified because the information is private.

Wumei owns grocery operator Wumart Stores Inc as well as the local operations of home-improvement chain B&Q. Last month, Wumei completed the acquisition of an 80% stake in German wholesaler Metro AG’S Chinese unit, the people said. Wumei is still discussing which businesses would be included in any listing, according to the people.

Deliberations are an early stage and details of the fundraisings could still change, the people said. A representative from Wumei did not respond to requests for comment.

An IPO by Wumei would add to the list of Chinese companies that are looking to list in Hong Kong, including Jd.com Inc. and Netease Inc. Uncertainty over China’s plan to impose national security legislation could put a damper on hopes for the city to reclaim its title as one of the top listing venues globally. Companies have raised only Us$3.2bil through IPOS in the financial hub this year, putting it in fifth place behind exchanges in mainland China and New York, according to data compiled by Bloomberg.

Wumart Group chairman Zhang Wenzhong founded the chain in 1994, according to its website. Wumart has become one of the biggest retailers in China with more than 1,500 stores across the country, according to the site. Its annual revenue exceeded 100 billion yuan (Us$14bil). Wumart Stores was listed in Hong Kong until Wumei took the unit private in a deal completed in 2016. —