China retail giant raises $1.06 bln in Hong Kong IPO (AFP)

HONG KONG (AFP) – China's leading hypermarket operator Sun Art Retail Group has raised $1.06 billion in a Hong Kong share sale, defying recent volatility in the world's biggest IPO market.

The retail giant, backed by France's Groupe Auchan SA, has sold 1.14 billion shares at HK$7.20 (93 US cents) each, the top end of its price range, Dow Jones Newswires said, quoting an unnamed source.

The firm, which will start trading in Hong Kong on July 15, has an option to increase the offering by 15 percent if the shares are oversubscribed, which will boost the deal to $1.2 billion.

Company executives have said they were positive on the share sale and planned to use half of the proceeds to open 51 stores in mainland China by the end of next year.

Sun Art currently has 197 hypermarkets in China.

The group, previously known as Sun Holdings Greater China Ltd, is a joint venture between Taiwanese supermarket-to-cement conglomerate Ruentex Group and Groupe Auchan.

The offering, the latest bid by a Chinese firm to tap Hong Kong's IPO market -- the world's biggest in 2010 for the second year in a row -- comes despite a batch of weak new listings.

Some firms have recently decided to delay or cancel their listings in Hong Kong citing turmoil global markets.

Italian luxury goods maker Prada made a lacklustre debut in the financial hub in June after raising a lower-than-expected $2.14 billion in its share sale.

And Australian miner Resourcehouse also last month shelved an IPO originally slated to raise as much as $3.6 billion, citing weak market conditions.

China, ASEAN Strengthen Strategic Partnership

China, ASEAN Strengthen Strategic Partnership

The ASEAN-China Free Trade Area represents a market of 1.9 billion people

ASEAN-China Foreign Ministers' Meeting in Kunming, China (AP Photo/Xinhua, Lin Yiguang)

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ASEAN and China Foreign Ministers met in Kunming, China, yesterday to explore long-term strategic cooperation between the two sides, said ASEAN Secretariat in Jakarta

Connectivity, the 20th anniversary of ASEAN-China dialogue relations, ASEAN-China Free Trade Area, socio-cultural exchanges, cooperation to address non-traditional security issues and the East Asia Summit cooperation were among the key topics discussed.

The Secretary-General of ASEAN, Dr Surin Pitsuwan, said that emphasis had been put on the need to strengthen people-to-people interactions between the two sides to enhance mutual understanding.

The Foreign Ministers, said Dr Surin, also stressed that ASEAN, especially the border regions of ASEAN Member States contiguous to China, needed to engage and cooperate with the border provinces of China.

“The Southwestern provinces of China, Yunnan included, are natural markets and joint investment areas between ASEAN and China private sectors,” added Dr Surin, commenting on the economic potential between ASEAN and China.

“The field is still open, the competition is relatively low, the opportunities and potential are still very much open as compared to the saturated markets of the provinces on the Eastern coastline,” he added.

A year ago, the ASEAN-China Free Trade Area was realised, opening up a combined market of 1.9 billion people, accounting for a combined GDP of close to USD 6 trillion and a total trade value of USD 4.5 trillion.

The ASEAN Foreign Ministers arrived in Kunming, China, after embarking on a historic road trip that set off in Chiang Rai, Thailand, on 23 January. They visited the construction site of the 4th Mekong Bridge linking Chiang Kong (Thailand) and Houey Xay (Lao PDR), crossed the Mekong River by boat to Houey Xay (Lao PDR), then travelled by coach to Luang Nam Tha Province.

The Ministers stopped for briefings on Bokeo and Luang Nam Tha provinces as well as developments around Boten border checkpoint on the Lao side. They then passed the Mohan border checkpoint (China) and proceeded to Jinghong, before flying into Kunming, capital of Yunnan Province.

Inspired by this unprecedented trip, ASEAN Foreign Ministers looked forward to more such activities showcasing mainland, maritime and aviation connectivity within ASEAN and between ASEAN and its Dialogue Partners. They agreed to make the same journey next year westward to India.

To complete the loop, the Foreign Ministers also agreed to explore the possibility of maritime connectivity trips.