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Langham Drops on Worst 2013 Asia Debut for $549 Million IPO

Langham Hospitality Investments Ltd. (1270), a trust backed by Great Eagle Holdings Ltd. (41) hotels, fell 9.2 percent in Hong Kong in the worst debut for an initial public offering of least $500 million in Asia this year.
The shares closed at HK$4.54. The benchmark Hang Seng Index slid 0.3 percent. Langham Hospitality, based in Hong Kong, raised HK$4.26 billion ($549 million) last week selling units at HK$5.00 each, near the midpoint of its price range, according to data compiled by Bloomberg. Asian Pay Television Trust (APTT) sank 5.2 percent in Singapore yesterday on the second-worst debut after  Keppel REIT (KREIT) and Parkway Life Real Estate Investment led property trusts lower.
“There could be some knee-jerk reaction to rising U.S. bond yields, which is not good for yield stocks such as REITs,” said Ng Soo Nam, Singapore-based chief investment officer at Nikko Asset Management Asia Ltd., whose Japan-based parent oversees about $165 billion.
The trust is backed by hotels including The Langham, Langham Place Hotel and Eaton, all located in Hong Kong’s Kowloon district, according to a filing to the Hong Kong stock exchange. The hotels have a combined 1,629 guest rooms, the document showed.
Citigroup Inc., Deutsche Bank AG and HSBC Holdings Plc managed the offering for Langham Hospitality, according to a prospectus. Langham Hospitality boosted operating profit by 14.5 percent to HK$504.8 million last year, while revenue increased 8.9 percent to HK$1.6 billion as occupancy rates improved, the prospectus shows.

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