HK-listed Chinese Investment Bank CICC Looks To Raise $2b In Shanghai IPO

State-owned China International Capital Corporation Limited (CICC), a Hong Kong-listed investment bank, is looking to raise as much as 13 billion yuan ($2 billion) on the Main Board of the Shanghai Stock Exchange (SSE), according to a company filing on Thursday.

The company, which kicked off its subscription exercise on October 20, has offered up to 459 million common shares at 28.78 yuan ($4.3) apiece. The shares have been oversubscribed 2,846 times.

Orient Securities Investment Banking and China Galaxy Securities are the principal underwriters for the deal, while BOC International (China), Ping An Securities, and Shenwan Hongyuan Financing Services are the joint sponsors. CICC will float the shares under the symbol “601995”.

After the IPO, CICC will aim to fully fuel its capital funds and operating funds in a bid to support its business development within and outside of China.

With registered capital of $100 million, China Construction Bank, Morgan Stanley, and other consortiums had partnered to set up CICC in 1995. It specialises in providing a range of financial services including investment banking, equities, wealth management, and investment business. The company went public in Hong Kong in 2015.

It launched its private equity investment arm CICC Capital in 2017 to conduct investment and management activities across the world. On October 19, CICC Capital had participated in a 1.5 billion yuan ($224 million) funding in molecular diagnostics firm 3DMed Diagnostic. 

Headquartered in Beijing, CICC has established a chain of branches in mainland China. It also has seven overseas offices in Hong Kong, Singapore, Tokyo, New York, London, San Francisco, and Frankfurt. 

Its annual revenues stood at 16 billion yuan ($2.4 billion) in 2019, 13 billion yuan ($1.9 billion) in 2018, and 11 billion yuan ($1.7 billion) in 2017, according to the prospectus. 

Chinese state-owned Central Huijin Investment will be the largest shareholder in CICC, bringing down its stake from 44.32 per cent to 40.11 per cent after the IPO. Haier Financial Holdings will become its second-largest shareholder with 8.26 per cent equity interest.

Tencent Mobility will also hold 4.95 per cent stake, followed by Alibaba Group’s Des Voeux Investment with 4.64 per cent equity. Tencent had seeded nearly 2.4 billion yuan ($362 million) in CICC in 2017. Subsequently, in 2019, Alibaba had also made an undisclosed strategic investment in the bank.