According to Reuters, Hong Kong conglomerate CK Hutchison has selected investment banks Goldman Sachs and UBS Group AG to lead the initial public offering for its A.S. Watson Group unit. The plan is for a dual listing in Hong Kong and London, potentially happening this year. The report, citing people familiar with the matter, suggests the IPO could raise $2 billion or more. A.S. Watson is a massive health and beauty retailer operating chains like Watsons and Superdrug, with over 17,000 stores across 31 markets in Asia and Europe. This comes as Hong Kong’s IPO market showed strength in 2025, notching 114 new listings that raised $36.5 billion. However, discussions are still ongoing and the timing and final deal size remain preliminary.
Why This IPO Is a Big Deal
Look, a $2 billion-plus IPO is always a headline grabber. But this one feels particularly symbolic. CK Hutchison, the sprawling empire built by Li Ka-shing, is essentially taking one of its crown jewels public. A.S. Watson isn’t some flashy tech startup; it’s a classic, asset-heavy retail business with a huge physical footprint. For a market like Hong Kong, which has been through some rough years, landing a marquee listing like this from a local titan is a vote of confidence. It’s the kind of “old economy” cash-flow story that big institutional investors still love. And the dual-listing structure? That’s a smart hedge, giving access to both Asian and European capital pools.
But Here’s the Potential Hiccups
Now, let’s not get carried away. The report is clear: details are “preliminary.” That’s banker-speak for “this could easily slip into next year or get scaled back.” A dual listing itself adds layers of complexity—different regulatory regimes, investor appetites, and timing challenges. And then there’s the valuation question. How do you value a global retailer in today’s market? Investors are wary of brick-and-mortar retail, even one as dominant as Watson’s. They’ll want to see a compelling growth story, not just a tale of vast store counts. Can the banks convince the market that this is a modern, growing enterprise and not just a legacy cash cow being monetized? That’s the real pitch.
What This Signals for Markets
So what’s the bigger picture? If this IPO lands successfully in 2025, it could really cement Hong Kong’s comeback narrative. It would show that large, complex, and valuable spin-offs from family conglomerates can still get done there. But it’s also a test for London, which has been fighting to retain its status as a global financial hub. Snagging a piece of a major Asian retailer’s listing is a win. Basically, this isn’t just about selling shares in a drugstore chain. It’s a bellwether for two financial centers and a gauge of investor appetite for mature, global businesses. I think the market will be watching this one closely, not just for the deal size, but for what it says about the health of the IPO pipeline everywhere.
