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UPDATE 1-China Everbright Bank's $3bln IPO falls 5 pct in Hong Kong debut

Thursday, 19 Dec 2013 | 9:49 PM ET

* Largest Hong Kong share sale since February

* Offering price at the bottom end of the range

HONG KONG, Dec 20 (Reuters) - China Everbright Bank Co Ltd , tumbled as much as 5 percent in its Hong Kong market debut on Friday, after raising $3 billion in its IPO -- its third attempt to list on the city's stock exchange.

Shares in China Everbright Bank fell to HK$3.78, below its offering price of HK$3.98, according to Hong Kong stock exchange data. The bank had marketed the deal in a range of HK$3.83 to HK$4.27 per share.

The IPO is unique not only for its previous efforts, but for the extraordinary size of its allotment to cornerstone investors, which took up more than 60 percent of the offering, or more than double the normal percentage.

China Everbright Bank received commitments worth $1.74 billion from 19 cornerstone investors including a whopping $800 million from China Shipping (Group) Co, according to its prospectus released earlier this month.

China's 11th biggest bank by market capitalisation raised money to bolster its capital as bad debt picks up on the back of a slowing economy, hurting investor interest in the financial sector shares in the world's second biggest economy.

The Hang Seng H Financial Index is down about 1 percent this year. Other recent listings such as Huishang Bank Corp Ltd and Bank of Chongqing trade near or below their listing price.

After an initial surge of as much as 40 percent, China Cinda Asset Management Co Ltd has also given up some of the gains.

The lending arm of state-backed China Everbright Group exercised last week an option to sell an additional 762 million shares on top of the base size of 5.08 billion shares, bringing the total deal value to HK$23.25 billion ($3.0 billion).

China Everbright Bank, also listed in Shanghai, failed in two previous attempts to list in Hong Kong, hit by market volatility around the time of the process.

The Everbright deal is Hong Kong's biggest share sale since China Petroleum & Chemical Corp (Sinopec) , Asia's largest refiner, raised $3.1 billion in February.

China Everbright Securities, China International Capital Corp, Morgan Stanley and UBS AG were the lead coordinators of the offering.

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