China’s Sunshine Insurance Leans Toward Pricing HK IPO at Bottom of Marketed Range

Sunshine Insurance Group Co. is leaning toward pricing its Hong Kong initial public offering at the bottom of its marketed range, according to people familiar with the matter.

The Beijing-based firm is weighing whether to sell 1.15 billion new shares at HK$5.83 apiece, the people said, asking not to be identified because the information isn’t public. At that price, the listing would raise about HK$6.7 billion ($863 million), Bloomberg calculations show.

The insurer had marketed shares at HK$5.83 to HK$6.45 apiece. Deliberations are ongoing, the price could still change and no final decisions have been made, the people said. An external representative for Sunshine didn’t immediately respond to a request for comment.

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Even priced at the bottom, Sunshine’s listing would be the biggest in the Asian financial hub since battery maker CALB Co. raised $1.3 billion in an October IPO. Several issuers are taking advantage of improving sentiment toward Chinese equities over the past weeks to launch share sales before the year-end holidays. December is set to be the second-busiest month for debuts in Hong Kong this year, according to data compiled by Bloomberg.

Sunshine Insurance operates businesses including life and health insurance, property and casualty insurance and asset management, its prospectus shows. It also has an asset management arm, an elderly care community and hotels including the Baccarat Hotel in New York City, which it bought in 2015 for $230 million.

The company posted net income of 1.7 billion yuan ($243.6 million) for the six months ended in June, a 2.5% drop versus the same period last year.

Sunshine is planning to use the proceeds to strengthen its capital base and support growth. The stock is slated to start trading on Dec. 9. Huatai International, China International Capital Corp., UBS Group AG and CCB International Holdings Ltd. are joint sponsors of the deal.

Photograph: The Hong Kong Exchanges & Clearing Ltd. (HKEX) logo is displayed atop a gong at the HKEX Connect Hall in Hong Kong, China, on Wednesday, June 10, 2020. Photo credit: Billy H.C. Kwok/Bloomberg

Copyright 2022 Bloomberg.


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