New World Development, a Hong Kong based property developer, is planning to spin-off a Chinese iron ore mining business. The new company will be majority owned by its own infrastructure unit NWS Holdings through a listing on the Hong Kong stock exchange.
The company currently holds mining rights to a large-scale open-pit iron ore mine in Lincheng county, Hebei. New World Development Managing Director Henry Cheng said that the spin-off company would establish its own profile as a separate listed entity with the ability to access the debt and equity capital markets to fund its operations, future developments and investment opportunities.
Tian Yuan plans to conduct the IPO in the second quarter and Citigroup Inc will be in charge of the offering. NWS has a 55.2% stake in Tian Yuan which owns and operates the Yanjiazhuang iron ore mine in Hebei. Yanjiazhuang Mine had proven and probable reserves of about 260 million tonnes.
This is the second time that the company has tried going public. The iron ore mining firm was to go public with a Hong King stock exchange listing last year to raise $522 million in May 2010 but decided against it due to the rather volatile market conditions at that time.