Espinasse on PICC
I was interviewed on CNBC’s “The Call” this morning by anchors Bernie Lo and Emily Chan on what’s in store for investors with the IPO in Hong Kong of mainland Chinese insurer PICC Group. read
Tag: Privatization
PICC launches US$3.6 billion Hong Kong IPO
PICC Group will finally kick off bookbuilding tomorrow, Thursday 22 November, for an IPO that could reach US$3.6 billion, and even top US$4 billion, assuming exercise in full of the over-allotment option. This would make it the largest IPO so far this year in Asia ex-Japan, ahead of the flotation of Felda Global Ventures in Malaysia. read
Will PICC’s IPO take off like a rocket?
People’s Insurance Company (Group) of China, otherwise known as PICC, is set to hit the market in Hong Kong this month in what could potentially make it the largest IPO in Asia (excluding Japan) this year. read
Listless and bored
Around this time last year I wrote a preview of the IPOs expected to arrive on the Hong Kong market. It’s telling that most of those same deals are still in the pipeline, twisting in some interminable pre-launch marketing limbo. read
As floats sink slowly in the East
There has been much talk of late about the decline of the Hong Kong market for initial public offerings. The volume of new listings is down. These days, deals that venture into marketing seem as likely to get pulled as to be priced. Most problematically, many IPOs that successfully close keep trading in the red. read
Mongolia’s Erdenes TT snubs Hong Kong for IPO
HONG KONG (Dow Jones Investment Banker) – News last week that Mongolia’s Erdenes Tavan Tolgoi, which owns one of the world’s largest coking coal deposits, would drop – for now – Hong Kong as one of the listing locations for its long-awaited IPO came as a surprise to market observers. The reasons probably include a disappointing performance for relevant offerings in Hong Kong, disclosure issues, as well as a comparatively weaker depositary receipt platform. read
Will Brunei’s DST answer the call to float?
HONG KONG (Dow Jones Investment Banker) – As one of Asia’s richest nations, the Sultanate of Brunei Darussalam relies on a significant expatriate population for the production of offshore oil. That, in turn, has fuelled the growth of its major mobile telecommunications provider, Data Stream Technologies Communications (DST). But with penetration rates near saturation, DST needs to re-invent itself and offer value-added products and services besides roaming. With equity markets in turmoil, it could consider issuing an Islamic going-public convertible bond prior to a listing in Kuala Lumpur – or in Singapore, perhaps through a business trust. read
Golden horde of bankers seeks Mongolia’s riches
HONG KONG (Dow Jones Investment Banker) – Mongolia’s top 20 index is up more than 50% in local terms this year, but trading volumes remain diminutive. This could all change with the proposed listing of coal mining behemoth Erdenes Tavan Tolgoi (Erdenes TT), whose name means “five heads” in Mongolian. While lead banks have been appointed, their exact roles are said to remain fluid, and a gaggle of global houses is still competing to find its way into the offering, which will raise Mongolia’s profile on the international stage. Indeed, the fortunes of Mongolian IPOs will continue to rely heavily on international institutional investors.
The ugly consequences of committed underwriting
HONG KONG (Dow Jones Investment Banker) – The US$500 million-plus privatization of national carrier PT Garuda Indonesia last month is widely thought to have been rushed and significantly overpriced, and some of the domestic underwriters reportedly may now need to raise capital to cover their losses. The sorry episode brings to light the practice of firm commitment underwriting of IPOs in some jurisdictions in Asia, and shows it actually does little for corporates, their shareholders and investors, let alone the brokerages involved.
Garuda falls 17% on first day of trading
As one of the largest IPOs in Indonesia for several years, Indonesia’s privatization of its national airline Garuda was closely watched by market participants. The poor start of trading, however, with the shares opening 6.7% down and closing 17% below the offer price on the first day (and, at one point, falling by as much as 23%), may negatively affect the IPOs of other privatization candidates in South East Asia’s most populous nation. read