By DPA,
Beijing: The Agricultural Bank of China Ltd is on track to attract a record $22.1 billion after pricing its initial public offering in Shanghai and Hong Kong, reports said Wednesday.
The Beijing-based bank had priced 25.4 billion shares to be listed in Hong Kong at 3.20 Hong Kong dollars each ($0.41), and 22.24 million Shanghai-listed shares at 2.68 yuan each ($0.40), the top of its indicated price range, Chinese business magazine Caixin said.
The magazine quoted “authorities close to the Agricultural Bank” as saying the bank had fixed the two prices early Wednesday, while other reports said it would officially announce the prices late Wednesday or early Thursday.
The reported prices would net the bank a total of $19.2 billion. A “Greenshoe” option to issue up to 15 percent additional shares to underwriters would raise an additional $2.9 billion, taking the offering past the world-record $21.9 billion raised by the Industrial and Commercial Bank of China in October 2006.
The Agricultural Bank of China, the third-largest lender of China’s “big four” banks, plans to start trading its new shares on July 15 in Shanghai and July 16 in Hong Kong.
Analysts said plans for the bank’s listing in Shanghai were one of the factors behind a recent slump in Chinese stock markets as investors feared the new shares would draw investors away from other stocks.
In an earlier report, Caixin said bank officials had visited large institutional investors in China last month to solicit support for the IPO.
It quoted one institutional investor as saying he was given the impression that supporting the IPO had been “framed as a sort of national duty”.
The bank’s vice president, Pan Gongsheng, said in mid-June that strategic investors had already committed to buying about 40 percent of the Shanghai-listed shares.
The magazine said it has seen a bank document listing 11 key investments in the Hong Kong-listed shares, including a commitment to buy shares valued at $2.8 billion by the Qatar Investment Authority and $800 million by the Kuwait Investment Authority.
Two of China’s other main commercial banks are also seeking funds through rights issues.
On Tuesday, Hong Kong’s Ming Pao newspaper said the Industrial and Commercial Bank of China, the world’s biggest lender by market value, also planned to raise up to $6.6 dollars through a rights offer to existing shareholders.
On Friday, the Bank of China said it plans to raise up to $8.8 billion through a rights issue.