Guolian Planning $600 Million IPO While RBS Exits Joint Venture

Guolian Securities Co., the Chinese brokerage partner of Royal Bank of Scotland Group Plc, plans to seek as much as $600 million in a Hong Kong initial public offering, people with knowledge of the matter said.

The company, based in eastern China’s Wuxi city, aims to start the offering in the second half, according to the people. Guolian has yet to obtain regulatory approvals for the share sale, they said, asking not to be identified as the information is private.

Guolian follows larger Chinese brokers in raising capital in Hong Kong to fund increased lending to equity traders as stocks in China surge to a seven-year high. GF Securities Co. completed a $4.1 billion share sale this month, while Huatai Securities Co. is planning a similiar-size deal in the city.

RBS is in the process of transferring its 33.3 percent holding in Hua Ying Securities Co., a joint venture it founded with Guolian in 2011, the pre-listing filing shows. Bank of Communications Co. plans to buy the Hua Ying stake from RBS, which is exiting most of its operations in Asia, people with knowledge of the matter said last month.

GF Securities, based in Guangzhou, has surged 33 percent in Hong Kong since it started trading on April 10. Bocom International Holdings Co., ABCI Securities Co. and Qilu International Capital Ltd. are joint sponsors for Guolian’s IPO, according to a March 17 pre-listing filing.

Two calls to Guolian’s head office in Wuxi went unanswered. The company didn’t immediately reply to an e-mail sent to its general inquiry address.

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