China’s Ant Group (螞蟻集團) could raise up to US$17.3 billion in the Shanghai leg of the likely US$35 billion dual listing, the world’s largest ever, after some large investors submitted bids in the range of 68 yuan to 69 yuan per share, people with knowledge of the matter said.
The simultaneous listing in Hong Kong and Shanghai of the financial technology giant, backed by e-commerce behemoth Alibaba Group Holding Ltd (阿里巴巴), would beat the previous largest initial public offering (IPO), Saudi Arabian Oil Co’s US$29.4 billion float in December last year.
The pricing for the Shanghai tranche of the IPO was decided on Friday, Alibaba founder Jack Ma (馬雲) said on Saturday, without disclosing the price.
Photo: Bloomberg
“It’s the first time that the pricing of such a big listing — the largest in human history — has been determined outside New York City,” he told the Bund Summit in Shanghai, referring to Ant’s float as a “miracle.”
Later on Saturday, a person with direct knowledge of the matter said that many large Chinese fund managers had bid for Ant shares in the listing on the NASDAQ-style STAR Market in Shanghai at close to 69 yuan apiece.
At that price, Ant could raise up to 115.3 billion yuan ($17.24 billion) in the Shanghai tranche, valuing the company as a whole at up to 2.1 trillion yuan, before a 15 percent greenshoe or overallotment option is exercised.
Under local market rules, the final price for the IPO, which would also be the first dual listing in Hong Kong and on the year-old STAR, is based on guidance from large investors.
Ant declined to comment on the pricing.
The IPO would burnish the Shanghai-based exchange’s status as a fast-growing capital markets center, at a time when rising China-US tensions have triggered concerns about the prospects of listing of Chinese companies in New York.
Ant has chosen the stock code 688688 for its Shanghai listing, which for Chinese speakers combines two of the luckiest or most auspicious numbers, together symbolizing long-lasting prosperity and good fortune in Chinese culture.
Books for the Shanghai leg of the float would open for one day on Thursday.
Ant plans to sell up to 1.67 billion shares in the Shanghai float, which is set to be the biggest IPO in China, eclipsing the record set by Agricultural Bank of China’s (中國農業銀行) US$10.1 billion Shanghai float in 2010, according to Refinitiv data.
Strategic investors, whose investments in Ant’s STAR IPO would be locked up for at least 12 months, would account for 80 percent of the Shanghai float.
Among them are Zhejiang Tmall Technology Co Ltd (浙江天貓技術), a unit of Alibaba, which has committed to purchase 44 percent of the Shanghai float, according to Ant’s updated prospectus.
Ant aims to split the share sale evenly between Hong Kong and Shanghai, selling up to 11 percent of its enlarged share capital.
For the Hong Kong leg, Ant plans to open order books as soon as Monday and price the offering in the coming days, separate sources have said.
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