Hong Kongs New Frontier Group In Talks To Raise Second SPAC IPO

Hong Kong’s New Frontier Group is in talks with investment banks about an initial public offering (IPO) via a special-purpose acquisition company (SPAC), four people with knowledge of the matter told Reuters.

The China-focused investment firm, co-founded by property developer Nan Fung Group’s chairman Anthony Leung, aims to raise $300 million from the SPAC IPO, said one of the people, who declined to be named as the information is confidential.

New Frontier is tapping the SPAC market a second time after raising $250 million via a SPAC IPO in June 2018.

Typically a SPAC, or blank cheque company, will raise funds to acquire a private company with the purpose of taking it public, allowing such targets to sidestep a traditional IPO, and issue shares at $10 apiece.

It was not immediately clear what sector the second SPAC would target, but New Frontier on its website said it has interests in healthcare, internet, artificial intelligence, big data, education and financial services.

New Frontier did not immediately respond to a request for comment.

The company’s first SPAC, New Frontier Health (NFH), acquired Chinese healthcare services company United Family Healthcare in July 2019 for an enterprise value of $1.44 billion.

In February, NFH received an offer to be bought out by a consortium of investors in a deal that values the healthcare service provider at nearly $1.72 billion.

Worldwide, SPAC IPO proceeds have amounted to $60 billion this year, or 76% of 2020’s total of $79 billion, Refinitiv data showed.

A number of Hong Kong-based family businesses have considered SPAC IPOs recently, including luxury Rosewood Hotel Group, a unit of property developer New World Development and the family office of property tycoon Li Ka-shing, Reuters has reported.

Reuters