World's Largest Pork Supplier Pulls Asia's Biggest IPO For 2014 Due To "Deteriorating Market Conditions"

Tyler Durden's picture


One wouldn't know it judging by the latest panic buying in US stocks which are once again en route to hit all time highs within a few days, but one company that is not participating in the latest bout of buying euphoria is Chinese pork giant WH Group, the recent buyer of Smithfield foods.

It was only yesterday when Bloomberg reported that "WH Group, the world’s biggest pork supplier, is poised to raise about $1.3 billion in an initial public offering that had been cut by more than half because of slack investor demand, said people with knowledge of the matter. The company plans to sell 1.3 billion new shares at around HK$8 ($1.03) each, the low end of a marketed range, said the people, asking not to be identified because the information is private. WH Group is due to set a final price tomorrow after offering the shares at HK$8 to HK$11.25, according to revised terms for the deal obtained by Bloomberg News on April 23."

Fast forward to today when we find that the IPO, already set to be far weaker than originally expected, has just been pulled. SCMP updates that WH Group has postponed its US$1.9 billion share sale, two sources with direct knowledge of the decision have told the South China Morning Post, effectively axing what was once billed as the biggest initial public offering of stock in Asia so far this year.

The decision came after a decision last week to slash the price and the offer size of the deal from an original US$5 billion, which failed to tempt potential investors who were already signalling their unwillingness to swallow such a large transaction.

The reason:

In light of deteriorating market conditions and recent excessive market volatility, the company, having consulted the joint sponsors, has decided that the global offering will not proceed at this time,”

The S&P trading just shy of all time highs is now equivalent to "market conditions"? Ok then.

But the biggest loser(s)? The 29 investment banks working on the deal. Although don't cry for them - we are confident once the rigged, ZIRP-fueled market takes out all time highs on short notice, that the deal will be right back and taking advantage of "Other Widows' and Oprhans" money around the world, as the insider take advantage of the late stages of the Fed's equity bubble.

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Tue, 04/29/2014 - 10:18 | 4707553 gmrpeabody
gmrpeabody's picture

All I need is lipstick...

Tue, 04/29/2014 - 10:19 | 4707563 monkeyboy
monkeyboy's picture

Mmm Bacon...

Tue, 04/29/2014 - 10:23 | 4707578 BandGap
BandGap's picture

Pulled Pork! I get it!

The other white meat.

Tue, 04/29/2014 - 10:24 | 4707581 Haus-Targaryen
Haus-Targaryen's picture


Tue, 04/29/2014 - 10:27 | 4707596 CrazyCooter
CrazyCooter's picture

Only one sound bite will do ...



Tue, 04/29/2014 - 11:17 | 4707806 old naughty
old naughty's picture

no more floating pigs.

Tue, 04/29/2014 - 11:25 | 4707857 Dewey Cheatum Howe
Dewey Cheatum Howe's picture

I would argue the opposite if demand drops.

Someone might want to look into what was really killing all those pigs in China that were found floating in the rivers and subsequent push into the US markets and then pigs dying here now...

Tue, 04/29/2014 - 10:27 | 4707599 mvsjcl
mvsjcl's picture

The only pork likely to see a green light is Congressional pork.

Tue, 04/29/2014 - 10:41 | 4707666 JackT
JackT's picture

Interesting that Smithfield's got out just before the pig plague hit.  And I'm sure the plague has nothing to do wtih the lack of interest for the IPO...hmmmmmm.

Tue, 04/29/2014 - 11:09 | 4707772 Emergency Ward
Emergency Ward's picture

That's where the real diseased pork is found.

Tue, 04/29/2014 - 10:24 | 4707582 asscannon101
asscannon101's picture

I've got your back...

Tue, 04/29/2014 - 10:39 | 4707656 Kirk2NCC1701
Kirk2NCC1701's picture

A story w/o Bullshit. Nice.

Tue, 04/29/2014 - 10:18 | 4707555 ZeroPower
ZeroPower's picture

Of course, it's not IPOing in the US is it now. 

Tue, 04/29/2014 - 10:54 | 4707720 AccreditedEYE
AccreditedEYE's picture

This deal was supposed to get The Squid liquid; if they could have done it, they would have.

Tue, 04/29/2014 - 10:19 | 4707564 PlusTic
PlusTic's picture

Underwriters got PORKED on that deal...

Tue, 04/29/2014 - 10:20 | 4707567 pods
pods's picture

And this is a company that ostensibly makes a product.

One that I think I just saw floating down the river.


Tue, 04/29/2014 - 10:25 | 4707590 BandGap
BandGap's picture

That's a new product line - River Cured Ham

These marketing guys are always thinking.

Tue, 04/29/2014 - 10:45 | 4707685 Peter Pan
Peter Pan's picture

I actually think it's one of their distribution channels.

Tue, 04/29/2014 - 11:01 | 4707745 BandGap
BandGap's picture

And that channel flows into the Bay of Pigs!

I'm here all week. Don't forget to try the veal.

Tue, 04/29/2014 - 10:21 | 4707572 Azannoth
Azannoth's picture

I bet the Pigs are breathing a sigh of relief

Tue, 04/29/2014 - 10:24 | 4707586 Took Red Pill
Took Red Pill's picture

Could it have something to do with the virus that's killing pigs?

Tue, 04/29/2014 - 10:40 | 4707662 Cathartes Aura
Cathartes Aura's picture

last year the pictures of dead, rotting pigs in the rivers of China, then the purchase of Smithfields, and now the "mysterious virus" taking its toll on US pig farms. . .

p'haps consumers will finally re-cognise the system of CAFO with added pink slimed, cellulose, etc. - is not a healthy way to be sourcing their energy.

global "food" corporations need to be shunned for the poison-model they are - fist in glove with global pharma, cradle to grave dis-eased.

Tue, 04/29/2014 - 10:46 | 4707689 pods
pods's picture

You never see a happier group of people than those at a farmers market.


Tue, 04/29/2014 - 14:46 | 4708902 Cathartes Aura
Cathartes Aura's picture

those who produce their own foods, including humanely raised and prepared meats, radiate their inner peace, and health.

hope some take a few minutes to watch these.

On the Anatomy of Thrift  

from the folks at Farmstead Meatsmith

Tue, 04/29/2014 - 10:25 | 4707594 Save_America1st
Save_America1st's picture

the pigs get fat but the hogs get slaughtered

Tue, 04/29/2014 - 10:26 | 4707595 sodbuster
sodbuster's picture

Should've IPO'ed it in Washigton DC- they know a thing or two about pork.

Tue, 04/29/2014 - 10:32 | 4707615 Dr. Engali
Dr. Engali's picture

So a company that provides a service and actually produces something people need like food is shut out from the capital markets but companies that produce nothing like Twatter, Farcebook, and the like can raise unlimited funds. What a fucked up world.

Tue, 04/29/2014 - 10:38 | 4707652 Falconsixone
Falconsixone's picture

oink tha global offering

Tue, 04/29/2014 - 10:52 | 4707713 youngman
youngman's picture

 I am long BBQ sauces..slather baby..slather

Tue, 04/29/2014 - 11:04 | 4707755 IndianaJohn
IndianaJohn's picture

The many great comments below, makes my morning fun.

Smithfield Foods, Smithfield Virginia. They are the originators of the Virginia Dry Cured Ham. The company went on to become the country's largest hog slaughterer. China has bought Smithfield, and now the American Farmer can plow for the Chinaman. Hooray?

For those who are interested in pork production.

Tue, 04/29/2014 - 11:15 | 4707799 strangeglove
strangeglove's picture

This company is the largest owner of farms in the USA i read that somewhere on the internet i think. like 450 Farms

Tue, 04/29/2014 - 12:33 | 4708234 IndianaJohn
IndianaJohn's picture

Not "own" but contracted with a farm. The farmer enters in a contract to produce hogs for Smithfield. Most usually the conrtactor (Smithfield or other) rents the hoghouse from the farmer, Smithfield owns the hogs, and supplies the feed. The farmer takes daily care of the hogs and loads-out at shipping time. The cycle is 5 months. Every 5 months we get new feeder pigs from the contracror and start again.

The largest owner of farmland in US is Grandmother(s). 

Yeah, I kill a hog and eat it. Every cycle.

Tue, 04/29/2014 - 11:22 | 4707844 mijev
mijev's picture

Remember an ad from a few years ago: "Pork. The one you love."

Tue, 04/29/2014 - 11:54 | 4707992 NO SOLICITING

Or "Makin' Bacon"?

Tue, 04/29/2014 - 11:53 | 4707989 crazybob369
crazybob369's picture

Pigs are so darned cute.  Why do the stupid fuckers have to taste so damn good?

Tue, 04/29/2014 - 12:33 | 4708238 dearth vader
dearth vader's picture

Power to the Pigs, oink, oink!

Tue, 04/29/2014 - 14:25 | 4708824 SmittyinLA
SmittyinLA's picture

Ill buy some of that, I'm betting on the humping Rio mob to grow

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