HKEx eyes emerging Europe for IPOs

PUBLISHED : Thursday, 08 December, 2011, 12:00am
UPDATED : Thursday, 08 December, 2011, 12:00am


Hong Kong's stock exchange is seeking to attract state-owned firms from emerging European states as it looks to repeat its success of drawing mainland firms to list in the city.

Ronald Arculli (pictured), chairman of Hong Kong Exchanges and Clearing, met representatives of eastern European firms in Austria last week.

However, Arculli declined to identify potential listing candidates.

'State-owned enterprises in eastern Europe are in the process of privatisation and they want to tap funds where they can attract both Asian and international investors,'' Arculli told the South China Morning Post yesterday.

He said these firms had learnt from the experiences of hundreds of Chinese state-owned firms that are now listed in Hong Kong, and they might consider listing in the city or seek a dual listing in Hong Kong and their home markets.

'HKEx has worked as a bridge for international investors to mainland state-owned enterprises and the eastern European companies can do the same here,' Arculli said.

About 100 international firms have listed in Hong Kong in the past five years, and Arculli said he believed Europe's debt crisis would lead more small- and medium-sized firms -, which might have difficulties in getting bank loans - to consider listing in the city to raise funds from wealthy Asian investors.

'The HKEx is set to benefit from the crisis in this aspect,'' Arculli said, adding that such firms - either with strong consumer brands or are in the resource commodities business - would raise public awareness about them in Asia by listing in the city.

Hong Kong is among the largest initial public offering markets in the world, raising HK$444.97 billion last year and HK$284.23 billion in 2009.

In the first 10 months of this year, flotations in the city - including international firms such as Prada, Samsonite and Glencore - raised HK$208.31 billion. HKEx has been among the top five global listing markets since 2002, beating New York and London.

Arculli said 54 firms had received approval for a HKEx listing but have yet to be listed. There are another 87 applications pending approval.

HKEx and six bourses - from Brazil, Russia, India, China and South Africa - formed alliances in October to cross-sell each other's benchmark index derivatives from next year.

Arculli said the alliance would initially focus on derivatives, but the bourses might collaborate on listings in the long term. He will step down as HKEx chairman in April.