Baidu Inc BIDU is set to raise about $3.1 billion (HK$23.9 billion) from 95 million Hong Kong share sales, Bloomberg reports.
- Baidu waited for the relaxation in tech share volatility to join a bevy of U.S.-listed Chinese companies getting listed in Hong Kong, led by Alibaba Group Holding Ltd BABA, Autohome Inc ATHM. Other potential listers include Tencent Music Entertainment Group TME and Bilibili Inc BILI.
- The company intended to price the offering at HK$252 per share, representing a 2.7% discount to the Tuesday closing price of $266.78. One American depositary share was equivalent to eight ordinary shares being listed in Hong Kong.
- The retail tranche of the deal, which was worth 5% of the total share sale, was oversubscribed about 100 times. At that rate, 12% of the deal would be sold to those retail investors under Hong Kong’s clawback rules. Online broker Futu recorded 90,000 subscriptions from investors to borrow HK$14.7 billion in margin loans.
- Baidu’s listing was touted as the biggest homecoming of a U.S.-traded Chinese company in Hong Kong at HK$23.9 billion, since NetEase Inc’s NTES HK$24.3 billion June 2020 offering. The trade war further fueled such expansion sprees by the U.S. listed Chinese technology companies driving the listing volumes for Hong Kong’s bourse.
- Bank of America, CLSA, and Goldman Sachs are joint sponsors of the offering, with China International Capital Corp., UBS Group, and CCB International Holdings as joint global coordinators.
- Baidu’s shares are estimated to start trading in Hong Kong on March 23.
- Price action: BIDU shares traded lower by 2.77% at $259.4 in the premarket session on the last check Wednesday.
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