Date
16 December 2017
Hong Kong is set for its third-largest IPO of 2015 as China Reinsurance prepares for a listing. Photo: Bloomberg
Hong Kong is set for its third-largest IPO of 2015 as China Reinsurance prepares for a listing. Photo: Bloomberg

China Re draws 15 cornerstone investors for US$2 bln IPO

China Reinsurance (Group) is said to have received commitments worth US$1.12 billion from cornerstone investors as the state-owned reinsurer prepares for a US$2 billion Hong Kong IPO.

Entities that have pledged to invest in China Re include Great Wall Pan Asia International Investment, State Grid Corp of China, China Development Bank, People’s Insurance Co. (Group) of China, Prudential Insurance Co., and China Life Insurance Co., according to Reuters.

Great Wall Pan Asia and State Grid Corp are each taking up US$150 million worth of shares, while China Development Bank is investing US$110 million, the report said, citing a term sheet.

They are among 15 so-called cornerstone investors who will not be able to sell shares in China Re until six months after the IPO.

China Re, the mainland’s biggest reinsurer, is offering 5.77 billion new shares in the indicative range of HK$2.25 to HK$2.70 each.

The deal will be priced on Oct. 16, according to the report.

A successful listing by China Re would mark Hong Kong’s third-largest IPO this year following the earlier deals of Huatai Securities and GF Securities.

In late May, Huatai Securities raised US$4.5 billion in its IPO, while in April GF Securities reaped around US$3.6 billion from its share sale.

China Re, which has a near monopoly on China’s domestic reinsurance market, plans to use the IPO proceeds to strengthen its capital base and support its business expansion.

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