Firms assist Eastroc Beverage on HKD10.1bn HKEX IPO

Health drinks producer Eastroc Beverage has debuted on the HKEX, raising HKD10.1 billion, which marks the company’s successful completion of an “A+H” dual listing and comes five years after its SSE IPO in 2021. Herbert Smith Freehills Kramer, DeHeng Law Offices, Jia Yuan Law Offices and O’Melveny advised on the listing.

The IPO comprised the issue of 40.89 million shares priced at HKD248 each, with 10% allocated to the Hong Kong public and the rest placed internationally. Eastroc Beverage attracted prominent cornerstone investors, including the Qatar Investment Authority, Temasek, BlackRock, HongShan (formerly Sequoia China) and Tencent.

HSF Kramer advised Eastroc Beverage on Hong Kong and US law, with the team led by partners Matt Emsley, Stanley Xie, Jeremy Shen and Kong Jin. DeHeng Law Offices acted on PRC law, with partner Tang Hailong leading the team. Partners Pu Hong, Xu Shuai and Wang Maozhu provided support.

Huatai International, Morgan Stanley and UBS served as joint sponsors of the listing. Jia Yuan advised on PRC and Hong Kong law, with the team led by founding partner Xu Ying, senior partner Wanda Woo and partner Liu Xing. Partner Jenny Ho, senior associate Li Xueying and consultant Lee Pak Ho provided support.

O’Melveny acted as Hong Kong and US legal counsel for the joint sponsors, led by partners Geng Ke, Zhu Ke and Vincent Wang. Partner Robert Plesnarski advised on US Securities and Exchange Commission regulatory matters, while partners Luc Moritz and Billy Abbott provided US tax advice. Partner David Ribner advised on compliance matters relating to overseas economic sanctions and US outbound investment restrictions.

Founded in Shenzhen in 1994, Eastroc Beverage originated as a state-owned soy milk factory and was later acquired by its current chairman, Lin Muqin, who transformed it into a privately owned enterprise. The company has expanded rapidly, adopting a mass-market pricing strategy, with its flagship product being Eastroc Vitamin Energy Drink. Its product portfolio also includes coffee beverages, ready-to-drink teas and electrolyte drinks.-owned -market pricing strategy, with its flagship product being -to-drink teas and electrolyte drinks.

Its prospectus states that Eastroc Beverage ranked first in sales volume among health drinks companies in China from 2021 to 2025. Listing proceeds will be used to optimise production capacity, upgrade the supply chain, strengthen brand building and consumer engagement, advance its nationwide expansion strategy, develop overseas markets, enhance digitalisation across operations, expand product development capabilities, and for working capital and general corporate purposes.