The Shenzhen-listed company started taking investor orders for a base of 117.9 million shares at a maximum offer price of HK$263. The firm can upsize the deal by exercising a size adjustment or “greenshoe” option to sell up to 38 million additional shares combined. The stock is scheduled to begin trading in Hong Kong on May 20.
The top offer price was 1.5 per cent lower than Friday’s close in Shenzhen. The discount is significantly less than previous major deals in Hong Kong such as Chinese home appliance maker Midea’s US$4 billion first-time share sale last year, which saw a discount of around 20 per cent. Investors are usually offered stock at a discount in offshore listings to lure them to buy.
CATL’s mainland-listed shares opened 2.7 per cent higher on Monday.
The offering attracted cornerstone investors who agreed to commit about US$2.6 billion worth of the offer shares, according to the prospectus. These 23 investors include Chinese state-owned oil company Sinopec, sovereign wealth fund the Kuwait Investment Authority and alternative-asset manager Hillhouse Investment.
CATL decided to utilise a “selective marketing” strategy with the shares for institutional, professional and other investors internationally under Regulation S (Reg S) of the US Securities Act. Reg S restricts sales to US onshore investors and allows non-US investors to buy securities in a cost effective manner without registering with the market watchdog.
