Kiwi ABS 08 Gazprom returns to Japan 10 Noble relisting blocked 10
just evaluating the option (to
sell GDRs) without making any
decision.”
ONE MORE
The London link has attracted
some attention from
potential issuers. Shanghai-
listed SDIC POWER is one of the
Chinese companies seriously
considering a sale of GDRs in
2019 through the scheme.
The power plant operator is
in discussions with advisers on
the potential share sale, said
people with direct knowledge
of the matter, who put the deal
size at US$500m–$700m.
SDIC Power had a market
capitalisation of Rmb50.5bn
(US$7.37bn) as of last Thursday.
A spokesperson declined to
comment on the company’s
GDR plans.
HSBC, meanwhile, is tipped
to be the first London-listed
company to issue China
depositary receipts.
China’s stock market
regulator published draft rules
on August 31 for the Shanghai-
London stock link.
According to the consultation
draft, companies listed on the
London Stock Exchange will be
able to issue Chinese depositary
receipts on the Shanghai Stock
Exchange, while SSE-listed
companies will issue GDRs on
the LSE.
Both the CDRs and GDRs will
be fully convertible with an
issuer’s listed shares, although
there will be a six-month
lock-up period after a GDR
listing.
Huatai plans to sell up to
82.5m GDRs, equal to 10% of itsexisting share capital. It will use
the funds raised for domestic
and overseas expansion.
Huatai Financial, JP Morgan
and Morgan Stanley are the joint
global coordinators.NEW TECH BOARD
While the Shanghai-London
link is on hold, China is
pushing ahead with reforms in
its own markets. More details
emerged last week of a new
Shanghai technology board,
which emerged as a strategic
priority following comments
from President Xi Jinping inNovember, and is seen as the
latest bid to persuade Chinese
tech giants to sell shares at
home.
The CSRC and Shanghai
Stock Exchange last week held
a meeting with Citic Securities,
CICC, Huatai Securities and UBS
Securities to discuss rules and
entry requirements for the techboard, according to people with
direct knowledge of the matter.
The board will be modelled
after Nasdaq and Hong Kong
Stock Exchange. Listing
aspirants must meet one of six
sets of financial requirements
which cover valuation, profits
and net income. For instance,
companies with valuations
of more than Rmb1bn must
have two consecutive years of
profits, and their accumulated
net income for the two years
must be at least Rmb50m.
However, not all companies
need to be profitable to list onthe tech board. For instance,
there is no profit requirement
for companies with valuations
of more than Rmb3bn and
revenues of at least Rmb300m.
“They try to align the new
board with international
standards. Some companies
that are not profitable but have
core technology are encouraged
to list on the new board,” said a
Beijing-based ECM banker.
Sources told IFR that more
market-oriented mechanisms
would be introduced to the
new board. Seven types of
institutional investors and
individual investors with
Rmb500,000 of financial assets
and six-month investment
experience can invest in
companies on the board.
Companies will be allowed to
determine the timing of their
floats and also to introduce
greenshoe options.
Bankers believe that the final
shape of the tech board will be
unveiled soon. “It should come
no later than the Lunar New
Year in early February,” said a
banker.
The general expectation
is for the new board to be
launched before next June,
while the SSE will start taking
applications in March and April
at the earliest. underwritten by Mizuho, MUFG
and SMBC. (See News.)
Huawei’s 4.125% 2025s were
quoted at 90.731/91.387 or a
spread of 305.9bp/293.1bp,
according to Tradeweb. The
4.125% 2026s were quoted at
89.298/89.914 or a spread of
311.6bp/300.8bp, while the
4.00% 2027s were quoted at
87.639/88.262 or a spread of
293.0bp/272.5bp.
EXTRADITION REQUEST
Meng, a vice chair of the
Chinese technology company
and daughter of founder
Ren Zhengfei, was arrested
on December 1 with a court
hearing set for December 7.
Huawei in a statement
confirmed that Meng was
provisionally detained by
the Canadian authorities
on behalf of the US, which
seeks her extradition to face
unspecified charges in the
Eastern District of New York.
Meng was transferring flights
in Vancouver when she was
arrested.
Huawei said the company
had been given very little
information regarding the
charges and was not aware of
any wrongdoing by Meng.
The arrest is part of a US
investigation into an alleged
scheme to use the global
banking system to evade US
sanctions against Iran, Reuters
reported, citing people familiarwith the probe.
US authorities have been
probing Huawei since at least
2016 for allegedly shipping
products to Iran and other
countries in violation of US
export and sanctions laws.
Huawei in April called off
what would have been its
first euro-denominated bond
issue following reports of a US
investigation into its dealings
with Iran. The postponement
came after Huawei had released
final terms for the €500m
(US$609m) five-year deal and
begun allocating the bonds.
More recently, the probe
has included whether the
company used HSBC to conduct
illegal transactions involvingIran. HSBC itself is not under
investigation.
In its latest statement,
Huawei stressed again that it
“complies with all applicable
laws and regulations where it
operates, including applicable
export control and sanction
laws and regulations of the UN,
US and EU”.
China’s embassy in Canada
said it resolutely opposed the
arrest and demanded Meng’s
immediate release.
“The Chinese side firmly
opposes and strongly protests
over such kind of actions which
seriously harmed the human
rights of the victim,” the
embassy said in a statement on
its website. For daily news stories
visit http://www.ifrasia.com“Everything was ready but we were told the deal
had to be delayed due to technical issues related
to the Stock Connect. We don’t know what the
issues are and when they will be sorted but with
such a delay, the deal may have missed the best
window to launch by year-end.”