China Merchants Securities offering secures 11 cornerstone investors

Shanghai-listed China Merchants Securities has secured 11 cornerstone investors to take up $836m of shares, or about 63% of its Hong Kong IPO of HK$10.3b-$11.4b ($1.33b-$1.47b) at the bottom of the indicative price range.

The investors are: PICC Life (333m shares), Chow Tai Fook ($50m), East Pacific ($50m), China Life ($30m), China Reinsurance ($40m), Ma Huateng, chairman of Tencent ($30m), Fosun International ($30m), State Grid Corp ($30m), Yunnan Metropolitan Construction Investment (S$30m), Legit Value ($30m), South Industries Asset Management ($20m).

The Chinese brokerage is selling 891m shares at an indicative price range of HK$11.54-$12.78, representing a 2016 price/book of 1.1-1.2.

There is a greenshoe option of 133m shares, representing 15 percent of the base deal.

Books open on Monday and will close on Friday.

China Merchants Securities (HK), JP Morgan and Morgan Stanley are joint sponsors on the IPO.

The proceeds will be used to supplement capital for business development in both domestic and overseas markets.

Reuters