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China's 3rd-biggest broker to raise $2.1 bln in HK share sale-IFR
March 26, 2017 / 1:24 PM / 9 months ago

China's 3rd-biggest broker to raise $2.1 bln in HK share sale-IFR

HONG KONG, March 26 (Reuters) - Guotai Junan Securities , China’s third-largest brokerage by assets, is set to raise $2.1 billion in a rare fixed-price share offering in Hong Kong, IFR reported on Sunday, citing people familiar with the plans.

The Shanghai-listed company plans to sell 1.04 billion shares at a fixed price of HK$15.84 each, putting the total deal at HK$16.5 billion ($2.12 billion), IFR, a Thomson Reuters publication, reported. That would make it the largest stock sale in the city since the $7.63 billion initial public offering of Postal Savings Bank of China (PSBC) in September 2016.

Guotai Junan did not immediately reply to a Reuters request for comment after business hours on Sunday.

The deal will be launched on Monday, with pricing slated for Friday, IFR said.

The price represents a discount of about 25 percent to Guotai Junan’s closing price of 18.79 yuan in Shanghai on Friday. A fixed-price share offering is unusual, with most deals setting an indicative range before deciding on the final pricing, depending on demand.

Guotai Junan secured about $600 million in commitments from cornerstone investors for the deal, IFR reported. The company ranks behind CITIC Securities and Haitong Securities in terms of assets, revenue and profits, according to the offering prospectus.

Guotai Junan hired Bank of America Merrill Lynch, Goldman Sachs, Shanghai Pudong Development Bank International and Guotai Junan’s Hong Kong investment-banking arm - Guotai Junan International - as joint sponsors for the deal.

$1 = 7.7665 Hong Kong dollars Reporting by Fiona Lau of IFR; Writing by Elzio Barreto; editing by Susan Thomas

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