China’s AgBank shares surge 5pc on planned record US$15.8 billion private placement
Massive deal compares with total IPO fundraising on the A-share market last year of US$36.36 billion
Shares in Agricultural Bank of China surged more than 5 per cent on Tuesday in Hong Kong after the country’s third largest lender by assets announced plans to raise 100 billion yuan (US$15.8 billion) through private placement, which would be the A-share market’s largest ever private placement, if fully implemented.
Its Hong Kong-listed shares rose to HK$4.71 by close, while its Shanghai-traded stock advanced 2.5 per cent to 4.13 yuan. The firm led the banking sector higher in both markets.
On the Hong Kong exchange, bank stocks as a whole rose 0.4 per cent on average with HK$16.8 billion worth changing hands, representing 15 per cent of total market turnover. In mainland China, the sector had pared gains by close, but still up 0.1 per cent.
AgBank said late on Monday it will issue a maximum 27.473 billion A-shares to seven institutions.
In comparison, total IPO fundraising on the A-share market last year was 230 billion yuan (US$36.36 billion), according to data compiled by Wind.
The seven institutions are: Central Huijin Investment, which is owned by the Chinese central government; China’s Ministry of Finance; China National Tobacco Corporation (CNTC); Shanghai Haiyan Investment Management; Zhongwei Capital; CNTC Hubei Provincial Tobacco Corporation; and New China Insurance.
