Folks go to the sales space of battery producer CATL, on the Beijing Worldwide Automotive Exhibition, or Auto China 2024, in Beijing, China, April 25, 2024.
Tingshu Wang | Reuters
Chinese language battery producer CATL goals to boost no less than HK$31.01 billion ($3.99 billion) in its Hong Kong itemizing, in response to its prospectus filed on Monday, the biggest new share sale within the metropolis this yr.
The maker of batteries for electrical autos is promoting 117.9 million shares at a most supply worth of HK$263 per share, in response to filings lodged with the Hong Kong Inventory Trade.
The dimensions of the deal may improve to about $5.3 billion if a proposal measurement adjustment choice and a so-called greenshoe choice are exercised.
Greater than 20 cornerstone buyers, led by Sinopec and Kuwait Funding Authority, have subscribed to purchase about $2.62 billion value of CATL shares, the prospectus confirmed.
The supply measurement adjustment choice means the variety of shares could possibly be elevated by as much as 17.7 million shares to boost as much as an extra HK$4.65 billion ($598.00 million). There’s a greenshoe choice to promote an additional as much as 17.7 million shares.
The shares are as a consequence of worth between Tuesday and Friday, with the ultimate worth to be introduced on or earlier than Might 19, the filings confirmed.
CATL’s Hong Kong shares might be offered at a small low cost to the Shenzhen inventory’s closing worth on Friday if the share worth is HK$263 every. The dimensions of the low cost might be bigger if the Hong Kong share worth is under that degree.
CATL stated in its prospectus that it was granted a Hong Kong Inventory Trade waiver to not publish a minimal worth at which its shares could possibly be offered, because it may impression the buying and selling of its Shenzhen-listed inventory.
There might be 109.1 million shares offered to institutional buyers and eight.8 million shares out there for Hong Kong’s retail buyers to bid for, the prospectus confirmed.
The share sale would be the largest in Hong Kong since Midea Group raised $4.6 billion final yr.
CATL’s shares will begin buying and selling on the Hong Kong Inventory Trade on Might 20.
CLOSE EYE ON US-CHINA TRADE WAR
U.S. onshore buyers will be unable to purchase CATL shares within the Hong Kong deal, the filings confirmed, however lots of these funds have offshore operations that might be capable of take part.
The corporate was positioned on a U.S. Protection Division listing in January of Chinese language corporations it says work with China’s navy. CATL stated in its prospectus that it was working with the U.S. division to deal with the ‘false designation’.
“It doesn’t limit us from conducting enterprise with entities aside from a small variety of U.S. governmental authorities, thus is anticipated to haven’t any substantial opposed impression on our enterprise,” it stated.
CATL’s e book constructing comes because the U.S. and China hailed constructive talks in Geneva on the weekend in the direction of de-escalating their commerce battle, however Washington’s 145% tariff on Chinese language items and Beijing’s 125% tariff on U.S. items stay in place.
“Tariff insurance policies have been quickly evolving. At the moment, we can’t precisely assess the potential impression of such insurance policies on our enterprise, and we are going to carefully monitor the related scenario,” CATL’s prospectus stated.
CATL has beforehand stated the impression from U.S. tariffs on the corporate could be minimal as that market accounts for under a small a part of its enterprise.
Its North American enterprise has been largely restricted as a consequence of insurance policies set by the Biden administration, which excluded Chinese language batteries from an EV subsidy scheme.
CATL has been licensing its battery know-how to assist its U.S. shoppers, together with Ford and Tesla, to construct their battery vegetation as a substitute of constructing its personal whereas such partnerships are additionally usually being criticized by U.S. politicians.