China Cinda Asset Management Co. (1359) plans to sell shares in a Hong Kong initial public offering at near the top end of a marketed price range to raise about $2.5 billion, said two people with knowledge of the matter.
Strong demand prompted the company to stop taking orders for shares yesterday, a day earlier than scheduled, said the people, who asked not to be identified because the information is private. Institutional investors ordered several times the amount of stock available to them at the high end of the price range, they said.
Cinda, one of four funds created in 1999 to buy bad debts from China’s banks, benefited from a resurgent IPO market in Hong Kong as investors bet the Chinese economy will stabilize. The IPO is the city’s biggest in a year and will bring proceeds raised in 2013 to more than $15 billion, data compiled by Bloomberg show.
The Hang Seng China Enterprises Index (HSCEI) of Chinese companies traded in Hong Kong has advanced 8.5 percent in the past six months, and Goldman Sachs Group Inc. forecast this week the measure will rally 18 percent by the end of 2014. Economic indicators including manufacturing growth for November have spurred optimism that China’s expansion is gaining momentum.
Cinda will start trading on Dec. 12, according to its IPO prospectus. The company offered about 5.3 billion shares at HK$3 to HK$3.58 apiece, the prospectus shows. A Hong Kong-based external spokeswoman for Cinda declined to comment on pricing.
The IPO is the city’s biggest since November 2012, when People’s Insurance Company (Group) of China Ltd. raised $3.6 billion, according to data compiled by Bloomberg. Companies have raised $12.6 billion through Hong Kong IPOs this year, surpassing the $8 billion for the whole of 2012, the data show.
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