Mahjong may be only game in town for IPO investors

Wed Nov 19, 2008 10:51pm EST
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By Mark Bendeich

SYDNEY (Reuters) - The clatter of mahjong tiles is among the few remaining signs of life in Asia's dying IPO market.

As initial public offers evaporate in front of the bonfire that is global equity markets, a small Chinese firm that makes fancy mahjong tables is stepping, undaunted, toward the flames.

But Treyo Leisure and Entertainment Ltd has decided not to list in the home of mahjong, one of China's most popular pastimes that some experts say dates back 3,000 years.

Instead, it has chosen Australia, where the local market has lost "only" 45 percent of its value this year and where retail investors can still be persuaded to part with some of their cash -- or at least that is what the company is banking on.

"For some companies it would be absolutely the worst time to float, but in other respects there are still retailers out there looking for a value stock," said Treyo's most senior Australian director, former gaming regulator Roger Smeed.

"They may not understand mahjong but they understand growth in revenue and growth in profitability," he added.

Treyo, with a factory in Hangzhou, southern China, makes mahjong tables that automatically shuffle and sort the game's 144 tiles. It is one of only dozens of companies still in the queue of upcoming IPOs in Asian markets and among an even rarer group who claim to be "quietly confident" their listings will go ahead.

TALL ORDER   Continued...