PAG backs Haitong's $1.8b Hong Kong offering
PAG has become a cornerstone investor in the Shanghai-listed brokerage Haitong Securities' Hong Kong IPO, buying $300 million worth of shares as part of a potential $1.8 billion offering.
The private equity firm is among 11 cornerstone investors that pledged to buy a combined $580 million of shares. Other participants include DE Shaw, Japan's SBI Holdings and Dah Sing Bank, IFR reported.
This is Haitong's second attempt at a Hong Kong IPO. The brokerage had planned to raise up to $1.7 billion last December, but delayed the listing due to the poor market conditions and disappointing performances by other Chinese financial firms debuting on the Hong Kong bourse. At that time, Warburg Pincus was one of the cornerstone investors, buying $210 million of shares, alongside a unit of Japan's Sumitomo Mitsui Trust Holdings.
The sale would be the biggest IPO in Asia Pacific so far in 2012, as well as the largest in Hong Kong since the $1.9 billion dual listing of New China Life Insurance in both Hong Kong and Shanghai last December.
Haitong is offering 1.229 billion new shares at an indicative range of HK$10.48-11.18. The offer is expected to be launched on Tuesday and priced on Friday.
The company is set to become the second mainland brokerage to list in Hong Kong. Last October, CITIC Securities, China's largest securities house, priced its IPO at the bottom end of the indicative range and required a stabilizing manger to ensure it didn't end the first day of trading even lower. However, the stock is now trading 20% over its listing price.
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