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Ant Group to close institutional book of $17.2 billion Hong Kong IPO early: sources

Published 10/26/2020, 10:52 PM
Updated 10/27/2020, 12:40 AM
© Reuters. FILE PHOTO: The logo of Ant Financial Services Group, Alibaba's financial affiliate

By Scott Murdoch

HONG KONG (Reuters) - Ant Group <688688.SS> (HK:6688) will close its Hong Kong institutional book building a day earlier than planned as it aims to raise about $17.2 billion in the city, according to three sources with direct knowledge of the matter.

The book was due to close on Thursday, but that deadline will be accelerated to Wednesday 5.00 p.m. in each region.

The order book was oversubscribed one hour after the launch on Monday, two separate sources with direct knowledge of the matter said.

Ant Group declined to comment on the planned early closure of the Hong Kong institutional book, which is part of its world record initial public offering (IPO).

It is looking to raise up to $34.4 billion in a dual listing in Hong Kong and Shanghai, with the offer split between the two exchanges, giving it a valuation of about $312 billion.

The sources asked not be identified as they were not authorised to comment to media.

Ant, which operates China's biggest mobile payments platform Alipay, is an affiliate of e-commerce giant Alibaba Group Holding (N:BABA) (HK:9988).

It will offer 41.76 million shares, or 2.5% of its total shares in Hong Kong, to retail investors whose demand to buy the stock is expected to be strong.

Hong Kong operates a 'clawback' system where heavy oversubscription from small investors can result in them getting a greater share.

The prospectus shows the total amount will be increased to 167.1 million shares, or 10% of the deal, if the initial retail allocation is more than 20 times oversubscribed.

The city's brokers are readying billions of dollars of margin financing to lend to customers to buy the stock..

© Reuters. Ant Group and Alipay logos are seen at the Shanghai office of Alipay

Retail investors need to finalise and pay for the shares they have bid for by Friday, according to Ant's prospectus.

Latest comments

2.5 percent offered to the public, why bother?
It's all FRAUD. The moment the IPO is over it shoots a little further and then it goes into a very long tailspin, like MOST hyped up stocks. Remember FB or Alibaba?
Or UBER
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