China Revives London Stock-Listing Program
By Joanne Chiu
Beijing has approved a Chinese insurer's plans to sell
securities in London, signaling that a tie-up between the U.K. and
Shanghai stock markets is no longer on hold.
China Pacific Insurance (Group) Co. said late Tuesday that
China's market regulator had approved its planned listing in
London. The group's shares already trade in Shanghai and Hong Kong,
and it has a market value of about $33.8 billion, according to
The issuance still requires the approval of stock exchanges and
U.K. regulators. The Shanghai Stock Exchange said it was reviewing
the listing plan and expected to grant approval soon.
The Shanghai-London Connect program, years in the making, so far
has produced only one listing. That came last June, when China's
Huatai Securities Co. raised more than $1.5 billion by selling
global depositary receipts in London.
State-backed electricity provider SDIC Power Holdings Co. was
set to follow, but halted its deal in December, blaming market
In January, a Shanghai Stock Exchange official and a senior
banker in Hong Kong told The Wall Street Journal that the Connect
program had been put on hold. Neither gave a reason for the hiatus,
which came after relations between the two countries had been
tested by unrest in Hong Kong.
China Pacific Insurance said it plans to issue a maximum of
nearly 126 million depositary receipts, which will be backed by
five times as many new ordinary shares in China. Based on Tuesday's
closing share price in Shanghai, that implies a deal size of
roughly $2.6 billion.
The insurer said it had secured a unit of reinsurance giant
Swiss Re as a cornerstone investor. Swiss Re will buy depositary
receipts equivalent to up to 1.5% of the Chinese group's total
ordinary shares, and has agreed to hold them for a three-year
Write to Joanne Chiu at email@example.com
(END) Dow Jones Newswires
June 03, 2020 01:59 ET (05:59 GMT)
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