Citic Securities Co. (600030.SH), China’s largest securities firm by market value, plans to raise up to $1.94 billion in a Hong Kong initial public offering ahead of listing on the Hong Kong stock exchange in October, a person familiar with the situation said Friday.
The firm, which will start taking orders from institutional investors on Friday, plans to sell 995.3 million shares at an indicative price range of HK$12.84 to HK$15.2 a share, the person said.
The price range also represents 8.64 to 10.23 times forecast 2011 earnings multiples before a greenshoe option.
The deal includes a greenshoe option to increase the offering size by 15 percent in the event of strong demand, which may boost the deal size to as much as $2.2 billion. Ensuring the deal has a greater likelihood of success than many others in a volatile market, the IPO of Citic Securities has secured $850 million worth of shares, or 44 percent of the offered shares, from six cornerstone investors, the person said. Cornerstone investors, who are normally guaranteed large allotments in an IPO in exchange for agreeing to hold the shares for a certain length of time, give other investors confidence in a deal during times of market volatility.
Cornerstone investors include Singapore state investment company Temasek Holdings Pte. Ltd, sovereign wealth fund Kuwait Investment Authority, Brazilian investment bank BTG Pactual SA and mutual fund Waddell & Reed, the person said. -By Prudence Ho
Category: Hong Kong