Cheil said on Friday it priced the IPO at 53,000 won per share, giving a combined value of about 2.8 trillion won ($2.51 billion) for the stakes held by the three children of family patriarch Lee Kun-hee in the company.
The 1.52 trillion won offering attracted approximately 400 trillion won worth of demand from institutional investors during a bookbuilding exercise on Wednesday and Thursday, a company spokesman said.
Cheil Industries is expected to be the key vehicle through which the Lee family will retain control of the Samsung Group. The May heart attack and hospitalisation of Lee Kun-hee, chairman of Samsung Electronics Co Ltd (>> Samsung Electronics Co Ltd), has added urgency to the process of transferring control.
Analysts had speculated that his three children may seek to sell some of their shares to help pay for an inheritance tax bill estimated to be as high as $6 billion. Share sales could still come after the IPO.
The listing of IT services affiliate Samsung SDS <018260.KS> in November attached a $5 billion price tag for the stakes held by the sprawling group's three heirs when it doubled its IPO price on its November debut.
Cheil's pricing of the IPO compared to an indicated range of 45,000 won to 53,000 won. It is expected to list on December 18.
Shareholders Samsung SDI (>> Samsung SDI Co Ltd), Samsung Card (>> Samsung Card Co Ltd) and KCC Corp (>> KCC Corp) will sell about a combined 18.7 million shares, while 10 million new shares will be issued by Cheil, which operates an amusement park and owns fashion brands.
Exceeding the 1.16 trillion won float of Samsung SDS, Cheil Industries is expected to be South Korea's biggest IPO since Samsung Life's (>> Samsung Life Insurance co., Ltd) 4.9 trillion won listing in 2010.
(Editing by Muralikumar Anantharaman)
By Joyce Lee
