CATL, a leading Chinese battery manufacturer, is set to price its Hong Kong listing at HK$263 ($33.7) per share and expand its offering to raise about $4.6 billion, according to a report by Reuters. The company’s offering received a more-than-expected reception, in part due to optimism stemming from the truce in the US-China trade war.
The offering, which launched on May 12 and will last until May 15, planned to offer 118 million H shares globally at no more than HK$263. Initially, CATL aimed to raise as much as HK$31 billion, or $3.99 billion, in the listing. However, the offering size adjustment option will be exercised, adding an additional 17.7 million shares to the offering. This adjustment will raise the total amount to around HK$35.66 billion ($4.57 billion).
The HK$263 offering price represents a discount of about 6 percent to CATL’s closing price of RMB 258.77 in Shenzhen. Typically, a company’s Hong Kong shares trade at a lower price than its mainland shares to incentivize investors to buy new shares.
According to a report by Tencent News, CATL has received over $50 billion in subscriptions from institutional investors as of May 14, with the share offering oversubscribed 30 times excluding the roughly $2.6 billion subscribed by cornerstone investors. The positive reception of the offering was attributed to the recent progress in US-China trade talks, which prompted hesitant institutional investors to participate.
CATL’s teams, intermediaries, and institutional investors initially struggled to agree on a pricing range, leading to only the upper limit of the offering price being set without a lower limit. However, after the positive developments in trade talks, investors became more confident, and the offering gained momentum.
The company’s shares will begin trading on the Hong Kong stock market on May 20 under the stock code 3750. This listing is expected to be the world’s largest in 2025, as reported by the London Stock Exchange. CATL’s successful offering reflects the growing investor interest in the electric vehicle and battery sector, positioning the company for further growth and expansion in the global market.
[Image credit: CnEVPost]
(Source: Reuters, Tencent News)
