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February 02, 2007

Ping An Starts RoadShow for $3.9 Billion IPO

posted by MR WAVETHEORY at 2/02/2007 12:01:00 AM
Another year, another big IPO. Ping An Insurance is one of the biggest deals this year globally. The key issue of course is whether the market will take this at a good price since the Chinese markets have been very volatile.

Ping An Insurance (Group) Co. (2318.HK: Quote, Profile , Research), China's No. 2 life insurer, will kick off what is expected to China's second biggest domestic IPO on Friday, which analysts estimate will raise at least US$3.9 billion.

Ping An, 19.9 percent-owned by HSBC (HSBA.L: Quote, Profile , Research) (0005.HK: Quote, Profile , Research), will start book building and investor roadshows on Friday, selling up to 1.15 billion domestic A shares for a listing on the Shanghai Stock Exchange expected around the start of March, it said in the statement published in China's major financial newspapers.

The Shanghai offer, at its maximum size, would account for 15.66 percent of Ping An's expanded capital of 7.345 billion outstanding shares. The company has already listed in Hong Kong.
Ping An plans to sell up to 345 million A shares to strategic investors with a lock-up period of 12 months, accounting for 30 percent of the Shanghai offer, it said.

A total of 287.5 million shares, or 25 percent of the offer, will be open to subscription of ordinary institutional investors, with a lock-up period of three months, while the remaining 517.5 million shares, or 45 percent, will be sold to retail investors.

After the book building, Ping An plans to announce a price range on Feb. 9, it said. Retail subscription will start on Feb. 12 and a final price will be made public on Feb. 14, it said.

At the worst case, the deal is priced cheap.

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