Yili raises $1.89bn from shares

By Jim Cornall

- Last updated on GMT

The private placement by Yili attracted 53 institutional and individual investors from around the world. Pic: Yili
The private placement by Yili attracted 53 institutional and individual investors from around the world. Pic: Yili

Related tags: Yili, Dairy

Yili Group has released its non-public offering announcement, signifying the finalization of the largest private placement in the consumer sector on China's A-share market.

The announcement said the shares were eventually allotted to 22 targets at the price of RMB 37.89 ($5.95) per share, with a total of 317,953,285 shares raising about RMB 12,047m ($1.89bn).

This private placement by Yili attracted 53 institutional and individual investors from around the world to bid for its shares. The issue price represents a discount of 5.46% from the closing price on the inquiry date, setting a new low since the new regulations on refinancing took effect.

Yili said its latest financial statements outperformed market expectations. During the first three quarters of 2021, the company realized total operating revenues of RMB 85,007m ($13.35bn), up 15.23% year-on-year, and its net profits amounted to RMB 7,967m ($1.25bn), representing year-on-year growth of 31.82%.

As one of the world's top five dairy producers, Yili said the announcement states funds raised through this issue will primarily be used for bolstering its layout and expanding its production capabilities for high-value-added product varieties, as well as for digitalizing operations.

The rapid growth of Yili's business scale and accelerated pace of establishing a globalized presence have resulted in an increase in the company's demand for working capital. Yili said the private placement can help optimize its financial structure and improve the net profit end.

Since going public, Yili has cumulatively distributed dividends 21 times, with cash dividends worth RMB 30.4bn ($4.77bn) in total.

At its 2021 Leadership Summit, chairman and president Pan Gang put forward the company's goal of a "New Vision for Value Creation," in which creating value for shareholders is one of the key pillars.

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