Bankers are pitching “homecoming” offerings to dozens of Chinese companies listed on Wall Street, as tensions between Beijing and Washington threaten the future of shares worth an estimated $1 trillion, reported the Financial Times.
Several big companies have already launched offerings in Hong Kong, as the Trump administration increases pressure on Chinese businesses trading on US markets. The latest was JD.com, the ecommerce group that this week completed a successful secondary share sale. The sale ranked as the world’s second biggest offering of the year, at nearly $4 billion.
The moves come after the US Senate passed a bill last month that could force Chinese companies to withdraw from American exchanges if they do not comply with US accounting standards. Bankers and lawyers say that plenty more US-listed Chinese companies could follow JD.com, meaning that Hong Kong could profit handsomely. US-listed Chinese companies have raised almost $20 billion through secondary listings in Hong Kong since November, including a nearly $13 billion bonanza for Alibaba.
Until recently, the Asian finance hub had “lacked a large pool of higher quality” Chinese technology companies, said Johnson Chui, head of equity capital markets for Asia Pacific at Credit Suisse. But the positive receptions for secondary listings, including those of NetEase, the gaming group, and tech company Alibaba, “show there is positive pent up investor demand and desire for more of these companies to be listed in Hong Kong.”