China Insurer Prices Hong Kong IPO Near Bottom
Chinese state-owned insurer PICC Group raised $3.1 billion in the biggest Hong Kong initial public offering in two years after pricing the deal on Friday near the bottom of an indicative range, the latest sign of tepid appetite for new listings in the city.
PICC's bottom-range pricing sets the stage for the few small deals still waiting to hit the Hong Kong market in the fourth quarter, which is usually the busiest time of year for equity offerings.
Upcoming deals include an up to $200 million listing by natural gas producer AAG Energy, a $300 million IPO by engineering company Wison Group and a $150 million listing from thermal and coking coal miner Century Energy.
People's Insurance Company (Group) of China (PICC), as the company is formally called, priced the IPO at HK$3.48 per share, near the bottom of an indicative range, according to sources with direct knowledge of the matter.
The company offered 6.9 billion new shares, putting the total deal at HK$24 billion ($3.1 billion). It had marketed the offering at an indicative range of HK$3.42-HK$4.03 per share.
The IPO is the biggest in Hong Kong since the $20.5 billion listing of AIA Group in October 2010. It is also the largest in Asia ex-Japan since plantation company Felda Global Ventures Holdings' $3.3 billion offering in June.
The company is slated to debut on the Hong Kong stock exchange on Dec. 7. The deal comes amid an massive drop in Hong Kong's IPO volumes, which for the last several years has been a top city globally for listings.